Teach children money management skills

By Dickson Tumuramye

Every parent's desire is to see his/her child grow into a successful man/woman. We all wish to be wealthy as well as our children. This is a reason why we work so hard to save and invest for the future. But few parents become intentional in teaching their children how to make and manage money from childhood. We only focus on academic excellence and we think that if children are exposed to money when young, they will be spoilt.

Some young children learn how to count money in class, yet we have money in our pockets daily. We don’t think it is so important to help a child distinguish the different physical currencies. We only wait when they are old. We can start this practice when every child is very young and keep teaching them until they are totally financially independent.

It all starts with teaching them to know the value of money and how we make money. Let them know that money is earned not given freely. Even a cash gift is money earned for a reason. A person gives you money as a gift because there is something he/she is appreciating in you.

Savings

Every child can learn how to save money from the age of three. There are many ways this can be done. You can buy a child a piggy bank at home where a child can drop any single coin/money they get. You can open a child account in the bank and teach them to always keep their savings there. We also grew up saving small monies we would get from our parents and this would help us buy what we want. There are now better ways of encouraging long-term saving skills.

Financial plan

Anybody in your house should always have a financial plan. If a child is in school or already working, they should know how to plan for their money. You can guide them through the planning process for their funds and learn how to spend money well. They should be able to make projections for their incomes so that they don’t learn to spend what they don’t have.

Investment strategy

If our children can master a saving culture, it is easy for them to develop investment ideas on their own. They can tell how they will use their money. Help them plan for investments that will bring them more money. If you have a business, you can invest their little savings in your business to help them earn a profit and out of this, they will know that money makes money when it is well used or reinvested. They can start up their own projects if their money can allow them. The ones with formal jobs or regular sources of income should not waste their money on things that don’t earn them more money. We can guide our children on how to invest.

Record keeping

Over time, I have learnt a hard way when I get money and spend it without recording. As a businessperson, I discovered that record-keeping helps me to know my incomes and expenditure and helps me to make projections easier. Teach children to learn how to keep records and track their incomes and expenses. If they have a business, this will help them make evaluations of how their businesses are progressing and where they are making profits or losses, among other things.

Exposure to money issues

Give your children a chance to learn about money issues and its value. For example, when you go shopping with them, ask them to inquire about the price of an item and negotiate where necessary and give them the chance to pay. Teach them to count money, ask for change and give accountability. Here, they are developing negotiation skills, self-confidence, accountability, etc.

 The writer is a child advocate, parenting coach, marriage counsellor, and founder-Men of Purpose mentorship programme

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 Dickson Tumuramye is also a motivational speaker on:

 #Positive parenting

 #Marriage and family

 #Child counseling 

 #Career guidance