A big part of being a parent is teaching our children the essentials of life. Financial responsibility is one of those essentials. It’s never too soon to start teaching them how to handle their personal finances. Here are some guidelines to help you get started.
* Save or Spend? Open a savings account for your child. When your child receives money as a gift, an allowance, for chores, or a summer job, teach them to save a portion and allow them to spend a portion. Create a goal for the savings, perhaps a new bike or video game.
* Teach your child to avoid buying things just because everyone else has that item. Ask them why they want the item, will they really use the item? Or do they just want it because someone they know has one? Impulsive spending may lead to financial problems in the future. Help them prioritize their spending. Is it more important to buy that video game now or save for the new bike they’ve been wanting?
* Make it fun. Take a little time each week to help your child learn about making a budget, checking or savings accounts, loans and interest. Getting them interested in finances early will help them throughout life.
* If your child is old enough to take on a summer or after school job, don’t forget to teach them the basics of income taxes. Explain about income tax withholdings and the reason for the deductions. Don’t forget to go over sales tax too.
* It’s important to encourage your child to ask questions and get involved in the household budget too.
Teaching your children financial responsibility early it will benefit them now and in the future. For assistance with all of your financial needs contact our office at 866-497-9761 to schedule an appointment with our advisors.