As soon as your child can count, start to introduce the concept of money. Explain the forms money comes in – cash, coins and cards. If your toddler has a play shop, post office or kitchen play simple games with them where they pay for the food or supplies they need. They can use toy money or blocks and other small toys can substitute. Introduce the idea of earning money as well. Encourage them to help you with suitable chores around the house like making their bed and offer token pocket money if they complete the task every day for a week.
Financial literacy is a key skill, and an important one to teach our children from an early age. If you have travelled on assignment with your family, you may have the opportunity to do things you only dreamed of as a child. If you are concerned your children may not understand the need for or value of money, we have some useful tips for expat parents.
Introduce them to money early
Save regularly
Encourage children to save from a young age. Saving is key to financial wellbeing as an adult. Saving money regularly will help your child to achieve a good credit rating as an adult, if they need a loan. In the meantime, start small. Help them choose a piggy bank to get started when they are young. A really nice way to introduce saving is to have three jars, one for spending, one for saving and one for sharing.
Agree rules around saving and sharing. It could be that savings can only be used on items over a certain value and sharing is used once a year for a good cause. If you are on expat assignment in a developing country it could be donated to a local cause, to a children's hospital or fundraising efforts at their school.
Talk about money
Talking about money at home really matters. It shouldn’t be a once off conversation either, talk to your children about money in an age appropriate way. When you are making a shopping list explain why you might buy one product over another because of the difference in cost and explain how having a list helps your family spend money wisely.
Shop with your child
- Although shopping with young children can be challenging, try to bring them as much as you can. It can also be a real-life classroom. Bring them to different kinds of shops so they see the variety of ways money is used. If they are a little older, encourage them to find products you are looking for on the shelf. For some products talk about the different options available and why you choose the options you do. Discuss topics like quality, budget and needs versus wants.
Set financial goals
- Encourage your child to set financial goals. For younger children it could be to save for a toy or game they want or to choose a charity to donate some money to. Encourage older children to make a budget, find work they can do around the house to earn money or set up a savings account in a local bank.
Play games that involve money
- The obvious one is Monopoly but don’t forget the classic version of the Game of Life, PayDay and Money Bags. Some money games take a fun but more nuanced approach to financial decisions. By choosing them, your children can learn there is more to money management than having as much money as possible.
Model responsible money habits
- As a parent, you are the primary role model in your child’s life. They will watch and learn from how you spend money. Help them to learn good financial habits by modeling them as much as possible. Discuss how you save and invest money. As your children get older discuss how you have managed money over the years.
- Ensuring your child has a good grasp of money as they grow can help them have a stable financial future.
- Protect your child’s health and wellbeing while on assignment with expat health insurance for families.
