We teach our kids how to eat healthy, so why not start them how to be financially healthy too?
Unlike healthy eating though, you won’t find schools teaching our children how to save and spend wisely – this is one thing they will ultimately learn from their parents!
I see too many adults entering retirement who’s biggest financial burden and risk to their retirement goals are adult children who still call on them for financial help.
I believe it is time our attitudes towards money, savings and debt changed and that we taught our children the most valuable lesson they can get.
Whether you give your child an allowance, or pay them for small tasks around the home, it’s a good idea to lay the savings foundations so they develop a healthy habit and put a little away each time they get ‘paid’.
The New South Wales Commission on Children and Young People reported in 2005 that more than half the children aged between 12 and 16 in New South Wales had an after-school job. It also found working had little or no negative impact on their lifestyle.
Teenagers benefit from having an after-school job in a number of ways. Not only do they get paid, but they also learn about tax, hourly rates and managing their study around their working hours.
So when the time comes for your kids to get a part-time job, it’s a good idea to help them set a financial goal to save for, rather than them frittering their wages away.
Whatever the situation, young people with part-time jobs can be taught good savings habits that will last a lifetime.
As they get older, credit is too easy to get, but hard to get out of, with car loans and refinancing for holidays easily bringing young people unstuck. (And calling on guess who for help???)
Build good habits now…
Young adults aged in their early 20s should start to consider a long-term savings strategy. A small monthly investment could provide a significant boost when the time comes to buy a home.
Parents…I know you all love to “give everything” for your children, but teaching them to be financially independent is one of the biggest gifts you can give them!