Children's Personal Finance - Teaching Kids About Money

Every parent wants to help their children to become successful adults. The following ideas will help you teach your children how to become financially successful.

Children should learn the value of money at a young age. To help them learn this you must set up guidelines to help your young children begin to understand financial principles. Do not give children a straight allowance and do not pay them to clean their room or to do chores they will be regularly expected to do. They will be disappointed when they realize that no one else is going to pay them to pick up after themselves and then they may not do it. Instead allow them to earn money by doing extra chores after their regular ones are completed.

You may want to work out a system where your child gets set amounts for certain jobs. The ones that may develop into marketable skills you can pay higher for, so that your child understands that some skills are worth pursuing. When deciding how much to pay for jobs, remember the goal is to encourage financial success, and this only comes through hard and entrepreneurial skills. So keep your pay somewhat low to encourage your children's creativity and get them thinking about how to make money from the neighbors and the surrounding community.

As your children earn money require them to save at least twenty percent. This teaches a major key to financial success, which is to pay yourself first, and live on less than your income. It also helps build their savings account for college or whatever later on. If you start this practice young enough your children won't even question it.

At the age of twelve allow them to buy all of their extra things. If they want a new outfit they will find a creative way to pay for it. If they can't find a way to earn enough money for their clothes and other things after trying very hard you can always be extra generous at birthdays and Christmas.

One of the best things you can do is to encourage marketable skills. Have discussions with your kids about the activities they are interested in and try to think of ways that these activities can be turned into a business. Many children will want to start their own business and many of them succeed. You may want to go so far as to require your children to work so many hours a week on gaining marketable skills. Many things fall into this category such as; piano lessons, horseback riding lessons, repairing a bike, playing with a graphics program on the computer, writing stories. Don't tell your child that something doesn't count if he or she really wants to pursue it, let them explain to you the details of how it could. Let them figure it out for themselves.

Introduce different types of work and let your kids get to know people with all types of different jobs. A good career reference book can spark many good dinner conversations as you discuss interesting and mostly unheard of jobs. Let your kids know the options are limitless.

When your kids are ready to move out on their own they may already have many creative business ideas that they want to pursue. Encourage them, but also encourage them to go to school and use the businesses to pay for it. Struggle brings appreciation. Let them know that a college degree is a wise pursuit because there should always be a backup plan and should usually be several. That way they will know if something doesn't work, they haven't failed they have just opened up a new opportunity for another business venture.

Your children can be successful in their own businesses or working for someone else if they have ingenuity and a little money know-how. You can give that to them and that is something they will appreciate for the rest of their lives.

© High Speed Ventures 2010