Many parents think that discussing with their children about money is not a good idea, or that doing this from an early age will take something from their childhood. Actually teaching children about the value of money will inflict a sense of responsibility in them. The question we might ask as parents is what and when to teach them about money.
It is a good idea to present children the evolution in investing and market trading. I remember my first approaches to this subject were at eleven yeas old. At that age, I used to hate everything that was about money, but many of my childhood friends were enthusiastic about receiving money as a gift. My parents explained me that they had a job because they needed money to pay the bills and to sustain family needs.
As parents, you need to teach your children to spend money wisely. Likewise, as parents, you should offer your children options – options to seek their paths to take to be self-sustained; Paths to seek ways to be financially independent – and ultimately, financially free.
Those being said, regardless what you do as parents, you need to teach your children the world of jobs and entrepreneurship. Some of you would say that jobs are better than starting out businesses, some would say vice versa. Again, the key is, no matter which one you perceive better, you should teach (and allow your children to learn) about both worlds.
Children must know from early age that in our world, everything that we do has a price, but there are also things that you cannot buy with money such as friendship, loyalty and others. I would teach my children that someone gets money when he works on something for it, and the money are the payment for what he does – no work, no pay. I would also teach my children that someone can also gets money if he/she makes his/her money to “work” on themselves – this can be achieved through investing (and yes, I truly think that saving in banks is NOT investing – it’s little or no return on investment and I’m not sure why people think banks would care enough to give you more from your savings.)
The key is this: As parents, you need to encourage an environment where your children can learn and talk about money as much as they want. I do understand in some culture that money is not something to talk about over family dinner, but this has got to be change – People fall into debts because they lack of understanding about how money and investing work – they make careless money-related decisions. All start from one situation: no-talks-about-money-subject policy.
You wouldn’t want to get your children in such position, are you?