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There comes a point in every young adult’s life at which they will be faced with the difficult realities of budgeting and financial management. Taking the time to teach children financial management while they’re young is an excellent idea likely to pay off in the long run, and it’s not as difficult as it may seem. Here are several tips for teaching your children financial management so they grow up with good money habits.

How to teach financial management

Teaching kids about money might sound intimidating, but it doesn’t have to be hard or super complicated. Most of us handle money frequently in our everyday lives, and kids can learn about money management from getting involved in simple tasks or learning opportunities that fit naturally into the rhythm of family life. Here are some things you can do to start teaching your child good financial habits today.

Play games that involve money.

Making lessons fun is a great way to ensure that they stick, and what kid doesn’t like board games? By playing games that involve money, such as Monopoly or Life, your child can learn while they play.

Make a wish list with your child.

One essential part of financial literacy and money management is learning how to prioritize between various possible ways to spend our money. You can help kids learn about prioritizing things they want to purchase by helping them make a wish list. This will teach prioritizing, setting goals, and sticking to a plan – all very important lessons for managing money successfully.

Use Shopping Trips as Teachable Moments

Involve your child in planning for a shopping trip within a budget and comparing options while at the store in order to make cost-effective purchases. By involving children in everyday activities where financial lessons naturally show up is a good way to teach them why finance skills are relevant in your family’s life.

Give an Allowance and Help Kids Manage It

One excellent way for kids to learn money management is to practice managing their own money on a small scale in a low-risk situation. If you give your child an allowance, they will naturally start to learn how to spend their money, and how to budget for larger purchases by saving smaller amounts of money over time.

Involve kids in major purchases

Help your child learn about making wise financial choices by getting them involved. Next time you have to make a major purchase, consider talking to your child about the ways your family decides on a budget and what to buy. This will help them learn how to make smart financial choices.