5 money lessons to teach children

[Stanbic IBTC team]

Once upon a time, there was a child who was about 5 years old. He was in a danfo with his mum one day and street hawkers approached them with all sorts of snacks and drinks when the bus stopped at a traffic light. Biscuits, biscuits, biscuits, one called out. The child turned to his mum and said “Mummy, I want gala”. Mummy bought the biscuits. Another hawker called out selling bright, colourful popcorn and again the child turned and tugged at his mum’s sleeve saying “Mummy, I want popcorn” and then ‘Mummy, I want Fanta’… At this point, Mummy got annoyed and sternly said to the child saying “you better stop that or I’ll beat you. Do you think money grows on trees?”

Oh yes, as far as he’s knows money could as well grow on trees. To most children, real-life money is just as abstract as the pretty notes that come with their monopoly game. They know Mom and Dad have cash, but they’re not really sure where the money comes from.

So how can you teach children the value of a naira? Want your child to be money-savvy like Warren Buffet? These tips will help your child learn how to manage money.

Lesson 1: Money doesn't grow on trees – Explain to your children that you work to make money, and the bank is a place that keeps it safe and can helps you make more.

Lesson 2: Work with your budget – Give them some allowance, it could N100 per week and you can monitor how they spend it. And if they spend the money on pointless things, they will have to go the next week without an allowance.

Lesson 3: Saving Is Cool - Your daughter has been disturbing you for a new toy car? Tell her to save up for it. You may be surprised at how excited she will be and once she has saved enough, take her shopping and let her pay for the item herself. She'll probably take better care of it and appreciate it far more than if it was handed to her.

Lesson 4: Investing should also be learned early - Explain the concept of using money to create money. For example, by putting money into a savings account, you can earn interest.

Lesson 5: Share - Encourage your kids to donate part of their allowance or any old toys and clothes to an orphanage or charity. It teaches them that money can be used to make other people happy, rather than just for buying things. Remind them that it's not how much you give -- every little bit counts.

Teaching your children about money early in their lives will go a long way towards ensuring that their financial future is secured.