Think your kids have a good understanding of money? Maybe not!
A Westpac NZ Kids and Money Report shows around 53% of country kids have a good understanding of money (vs 41% of city kids) with 37% having a poor to average understanding of the value of money.
The report also showed "children with regular exposure to money are more likely to have a better understanding of it" with regular pocket money or using technology helping.
So why is it important for children to have a good understanding of money? Put simply, better understanding of the value of money leads to better financial decisions. We all want our kids to be smart with their money, becoming financially independent and not reliant on Mum or Dad. While money is not everything, it is necessary if your children want to have a tertiary education, buy a bike, pay for that holiday or a future first home.
The most important thing you can do is to model good financial habits - kids are sponges and will learn very quickly from Mum or Dad! This means things like kids seeing you saving up for things vs using hire purchase or credit cards, paying your bills on time and not rushing into any expensive purchases.
So where to start?
- Start small, find something that appeals to your children and stick with it
- Show them what money can buy, let them help select and pay for the groceries
- Consider introducing pocket money in exchange for regular, set, small jobs at home
- Kidspot.co.nz also has some great ideas for teaching kids about money
Feel free to contact us with any ideas that have worked for you and your kids and we will share them with everyone.