In this article you will learn 4 strategies to learn how to educate financially children so that they know how to manage their money well.
According to a study conducted by Dr. Pressman at Brown University, most of our habits come directly from our parents.
If the parents were bad at managing their money, their children will be too, and if you don’t know how to do it, the money will disappear.
This means you will have no savings or assets. On the contrary, all you will have are debts and financial worries.
No parent wants their child to grow up struggling financially. However, if we take into account that most people have them, it is clear that parents have failed their children by teaching them about money management.
(Learn how this entrepreneur turned his debts into a 20 million dollar business)
It is time to put an end to this generation of parents who did not know how to properly instruct their children.
In my book Rich Kids, I share my strategies as a successful parent and mentor to help other parents with their children’s financial education. Find below some of these strategies.
How to educate children financially so that they manage their money well.
1. Teach them to save.
Saving is a habit that must be cultivated from an early age so that it can be used when young people get their first job.
Teach them to start with small sums, in this case it can be 5% of their salary. With the passage of time and the increase in salary, this percentage should increase until it reaches 10% and 20% upon reaching 30 years of age.
You can also teach them how to save half of their salary.
2. Teach them to invest.
As parents we must instill in our children the importance of seeking financial advisors to guide them to invest their savings wisely.
A good option is to find a Certified Financial Planner, considering that they are experts in developing financial plans. They must also pass rigorous tests and adhere to strict rules in order to keep their license.
3. Teach them about frugality.
Never confuse being frugal with being stingy. They are two very different terms. Being frugal requires these three elements:
- Awareness: Know in detail how you are spending your money.
- Quality: Spend your money on quality products and services.
- Buy offers: Spend as little money as possible, buying only products or services with low prices.
4. Teach them about delayed gratification.
As your child’s income increases, make sure he doesn’t fall into the trap of increasing his lifestyle; to accommodate his new income.
It is a very common habit among those people who do not know how to manage their money. As soon as they have a little more they need to find a way to spend it.
A habit of the rich is to forget the desire to spend. Teach them that that extra money should be sent directly to investment savings. And that they can postpone something they want to do or have today, in order to have and do better things tomorrow.
Conclusion.
Learning how to financially educate children is a process that takes time. However, the motivation will always be to give them the necessary knowledge so that they can build a better future.
And remember, if you are really interested in creating your own business and want to find more information on this subject, buy our book “How to create a company while you work. Discover how to manage your time, manage your money and motivate yourself while creating a company and working for another” , where you will find all the information you need to found your own company, without having to leave your job.
This article was originally published on richhabits.net. Its translation and publication in ModoEmprendedor has been authorized directly by the author and cannot be reproduced by any other means.
