How to talk to kids about money

2024 Author: Malcolm Clapton | [email protected]. Last modified: 2023-12-17 03:44

Lifehacker and Financial Environment - about what a child should know about money at 3, 6, 10 and 15 years old.

On April 25, 2018, a free lecture "How to talk with children about money" will be held at the N. A. Nekrasov Central Universal Scientific Library.

Ksenia Paderina and Evgenia Bliskavka will teach how to instill financial literacy in children. At the request of Lifehacker, the speakers briefly told why it is necessary to talk with children about money and at what age to start.

Evgeniya Bliskavka Head of the Financial Health Project. Author of the book "Children and Money".

Children get acquainted with money at the age of 2-3. Usually they are simply attracted by the bright banknote. Kids are counting the number of bills, not the denomination.

At the age of 5-6, children have their first money of their own: grandmother sent 1,000 for their birthday, mother gave 100 rubles for ice cream, the godfather encouraged them for good studies. Every year the amount of pocket money and the freedom at their disposal increase.

The total amount that pupils have in megalopolises is 3.5 billion rubles a month.

Research data from Synovate Comcon

At the same time, receiving pocket money is usually not subject to any rules. Children do not plan their income and expenses, do not know how to save or invest money.

73% of Russians do not involve a child in family budgeting. Lack of knowledge translates into high financial and personal risks not only for the teenager, but also for the whole family. Does this mean that children should not be given money? Of course not!

Research shows that people who have pocket money since childhood become more successful and satisfied adults. Those who, at a young age, have mastered the rules of budget management and gained experience in achieving goals, subsequently do much better at managing their adult financial lives.

Timeline of financial literacy

The sooner children gain experience in managing money, the more intelligent and resilient they are to economic shocks in adulthood. But this does not mean that a pregnant woman, instead of classics, should listen to financial reports, and instead of fairy tales, read the newborn Warren Buffett. Each age has its own approach.

3-4 years

• Explain the concepts of "expensive" and "cheap" to your child. "There are five cubes in this box, they are cheaper than those ten cubes."
• Explain the basics of commodity-money relations: all things have a value; first we pay for the product, then we pick it up, and so on.
• Learn to negotiate. For example, before going to the store, agree that you buy only one toy, but the child can choose it himself.

5-7 years

• Teach your child to shop independently. First, let me go through the cashier under your supervision, then give the exact amount and send one to the store, finally, instruct to buy goods from the list, keeping within a certain budget.
• Teach your child to save money. Get a piggy bank for change and set the rules for using it. For example, take money out of a piggy bank no more than once a month. From time to time, give the preschooler the right to choose between an expensive thing and a cheap one. Explain that a high-value item requires savings.
• Show an example of how to prioritize spending. "I bought a liter of milk, not just one little sweet yogurt, because the milk will make the porridge that you, your younger brother and grandparents will eat."

7-10 years old

• Send your child out to shop regularly. This not only develops independence and responsibility, but also teaches you to make shopping lists, take and check receipts.
• Develop the skill of handling pocket money. If relatives or friends gave the child a small amount of money, see how he will dispose of it. Did you put it all down on chocolates? You still need to work on the skill of accumulation and prioritization.
• Introduce your child to financial concepts: "rent", "family budget", "discounts", "sales", "loans". No need to lecture. Just explain these terms as they come up in conversation.

11-14 years old

• Regulate the circulation of pocket money. For example, agree that the child will receive 1,000 rubles a week. Of these, he must allocate funds for travel and school meals. The rest can be spent at its discretion.
• Engage your child in paid work that you can do. The teenager needs to feel the difference between price and value.

15-18 years old

• Get your teenager a part-time job. At the senior school age, children should already get the first experience of independent earnings. This will help not only to finally form an idea of the value of money, but also to determine the future profession.
• Don't interfere with your teen's personal budget. The money earned on his own, the teenager should spend himself. Let it be on stupidity - this is his personal experience. Otherwise, as an adult, he will continue to make childhood financial mistakes.

You can get more tips on raising financial literacy in children of different ages at the lectures of Ksenia Paderina and Evgenia Bliskavka. On it you will learn parenting techniques that will lay the foundation for your child's well-to-do life.

Theme: how to talk to children about money.

Date: April 25, 2018.

Time: 19:00.

A place: Central Universal Scientific Library named after N. A. Nekrasov (Moscow, metro station "Baumanskaya").

The lesson is free, but the number of places is limited. Hurry up to register.