While research has shown that children develop their money habits by the age of 7, there is still a lot of time to instill great financial values and practices as they grow into teenagers and adults. And, there’s no better time than the present, right?
As COVID-19 continues to ravage countries around the world, numerous financial experts are simply awaiting the eventual economic downturn that’s to follow. And, while you should be careful about how much information you relay to your children in order to avoid any unnecessary stress, it’s a good opportunity to teach your children about financial tips that will help them as they pave their own path in the aftermath of the pandemic.
Here are a few professional tips we can offer parents struggling to figure out how to teach their children about financial health during a global pandemic and the ever-evolving economic landscape that it will create in its aftermath.
Lead by Example
This is an important one when it comes to the physical aspects of the pandemic. Lead by example when it comes to social distancing and self-isolation suggestions from health organizations like the CDC.
But, you’ll also want to lead by example in terms of being a financial role model for your children as well. This one is a little easier said than done, as leading by example isn’t always practical when you’re dealing with real-life money issues during a pandemic such as a mortgage, car insurance rates, and a set of braces for each of your youngsters. However, you can take small actions to ensure they’ve got a great financial role model in you.
It’s a good idea to encourage conversations about money and allow them to ask honest questions about the family’s financial situation without going too much into detail. Take the time at home in quarantine with everybody to facilitate these kinds of conversations. The idea is to give them a good idea of what monthly bills are, the debt that can accrue and the smart ways in which you spend so they have a realistic idea of what financial planning looks like.
Engage Them in Fun Financial Activities
Stying home during lockdown? If your city has recently been asked to “shelter in place” then you’re likely looking for fun activities to engage your children as they learn from home. For older children and teenagers, you can make these activities practical.
If they’re not too cool to participate in the activity, you can create a family budget with them during a lockdown. It’ll likely be easier because expenses will be kept to a minimum (no going out, no movies, etc.). Let them be a part of the weekly grocery list and or challenge them to budget their entire allowance for the whole self-isolation period.
You can even introduce them to apps that help them budget as a way to let them spent time on their phones will still learning about financial health and cultivating strong financial planning skills. Be transparent about how much you have to spend on them during this global crisis and allow them to take charge of their own budget in order to understand that when the cash is gone, the fun usually winds down as well.
This is not only a great way to practice their math skills, but it will get them thinking about money from a standpoint that isn’t too stressful and will help them learn how to control their spending from a young age to prevent any issues down the road with credit, banking institutions or debt.
Setting Them Up for Success
It’s important to encourage a strong work ethic to ensure your children understand the value of hard-earned money as they begin to have to budget their own. Help your teens open their first bank account and allow them to make their own purchases, especially for big-ticket items that will give them the most amount of satisfaction in return for their hard work. There are many
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