One of the many challenges facing parents today is equipping their children to manage their own money effectively from a young age.
African Bank group executive for sales and marketing, Alfred Ramosedi said, “The problem we are facing is that when children grow up in privileged environments, they don’t know how to manage money. They’ve never learnt to save towards a goal or even been taught the basics of investing, despite growing up in households where saving and investing for the future was possible.”
Ramosedi said that children whose parents encourage them to manage money grow up to be responsible, financially independent adults. It is never too late to teach your children about money.
But where can you start?
Ramosedi recommended the following:
- Teach your children about saving money through a piggy bank. Don’t buy them everything they see and they will soon learn that money doesn’t grow on trees.
- Set up a meeting with a financial adviser when your child gets their first job and encourage them to save a percentage of their earnings each month.
- Set boundaries with your children about how long you will support them financially. Show them that money spent on education is only an investment if the child takes their studies seriously. Education should not be used to delay work life.
- Teach your children to be proud of the work they do, whether it be chores, starting their own business or having a part-time job.
“Children learn through the values they experience at home, not through what they’re told to value. If you want to give your child the gift of knowing how to manage money, be a good example. Decide what your value system is and don’t be afraid to discuss finances with your children.”
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