Tuesday, November 23, 2010

Essential Money Management Tips for Kids.

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Author Bio : This is a Guest Post by Marc Brown, a Financial Writer, associated with Oak View Law Group. Besides, he also maintains his own personal finance sites & advice people to lead a debt free life.

Debt is crucial concern to many people irrespective of rich and poor, which necessitates them to preserve money and manage their budget. It is even essential to teach your kids about how to plan their budget, save money thereby. As It would help them to properly utilize their financial resources in future. However kids are too innocent to understand the importance of money and budgeting. Therefore, parents should take the responsibility in their own shoulders to make their financial future secure.

Here are some tips which can help you to make your kids acknowledge the value of money:

1.  Budget Planning : Teach your kid to make a weekly or monthly budget. Ask them to allot their money to different areas. They should divide it as X% of the total money goes to the savings account, Y% to something else. Advice them about how much they must allot for each area and arrange them a depository where they can reserve their money.

2.  Playing with your kid : Play games with your kid that includes dealing with money. This will teach them to count money and will compel them to learn how to save it.

3.  Discuss family budget : Involve your kid in the family budget discussion. Give them a knowledge as to where the money goes, how you save, how much you afford to spend.

4.  Shop together : Take your child with you while you go for a shopping. Ask him to assist you by finding sales on items. Involve him while making a list of things to be purchased. Also tell him to keep a instant record of the total expenses.

5.  Live indication : Give your kid a new or a fresh storage box so that they can visualize the increment when they save and the deduction when they spend. This will help them to value savings.

6.  Training kids on real things : Kids remember the visualized things more than what they hear. Practical teachings are more effective where they can apply their own brains. Beside the weekly allowances that you give them, tell them that you would pay them an incentive if they do certain work for you. This way they will learn to value their own earnings.

7.  Teach them to have patience : Once your kid starts understanding more about money, he might hurry in getting what they like. So incorporate in them to have patience. Buy things what he likes but delay the purchase. This will help him having a control on his own desire of buying things.

8.  Teach them to compare price : It is very important that they learn to compare prices before buying something. Tell them that doing this will increase their savings.

Following these simple but important tips you can help your child to make a money management at an early age, which will be definitely prove to be very helpful in his future.

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