Formal financial primary education in schools is still a dream. Even when it happens, parents should consciously take the initiative to impart it to their young kids.
1. While each family may differ on the right time to expose a child to financial intricacies, parents may include kids in financial discussions pertaining to them if they are old enough, say 8 years.
2. It is the right time for parents to start imparting the basics of finances in informal chats with kids.
3. As they grow older, parents can expose them to the monetary system and cash flow in the household, and even discuss the purchases that involve them.
4. Parents can start these discussions when kids are 12 years old, and can even get them enrolled in a financial literacy programme, which will help them understand a bit about saving, investing and the importance of managing money.
5. After that, they too will become interested in checking prices, debating their values and taking decisions about small purchases themselves.
6. Involving the kids in their purchases, even making them contribute partially or wholly, will not only help them understand the value of money, but also provide confidence about taking decisions and setting goals in later life.
7. However, they should also be overruled when their choices are wrong, which will make them differentiate between right and wrong decisions, and this will be crucial to their money choices as adults.
8. They should also be exposed to the importance of savings by opening a bank account, and teaching them how money is earned diligently by giving them minor errands to perform and pay them for their effort.
9. Even financial advisers can help parents in educating and training their grown-up kids, through small-ticket investments, as tapping them young and servicing them well could also help their own long-term interests as these young investors go up the ladder, through upfront/trail commissions.
10. A timeline of financial awareness experiences for kids could be:-
a) 5-6 years: Fun experience with identifying coins and bank notes
b) 7-9 years: Wallet and piggy bank pocket money experience
c) 10-11 years: Child bank account full operating experience
d) 12-14 years: Online teaching portals experience
e) 15-16 years: Budgeting and goal-based saving experience
f) 17-18 years: Experience of education loan, investing and part-time job
1. While each family may differ on the right time to expose a child to financial intricacies, parents may include kids in financial discussions pertaining to them if they are old enough, say 8 years.
2. It is the right time for parents to start imparting the basics of finances in informal chats with kids.
3. As they grow older, parents can expose them to the monetary system and cash flow in the household, and even discuss the purchases that involve them.
4. Parents can start these discussions when kids are 12 years old, and can even get them enrolled in a financial literacy programme, which will help them understand a bit about saving, investing and the importance of managing money.
5. After that, they too will become interested in checking prices, debating their values and taking decisions about small purchases themselves.
6. Involving the kids in their purchases, even making them contribute partially or wholly, will not only help them understand the value of money, but also provide confidence about taking decisions and setting goals in later life.
7. However, they should also be overruled when their choices are wrong, which will make them differentiate between right and wrong decisions, and this will be crucial to their money choices as adults.
8. They should also be exposed to the importance of savings by opening a bank account, and teaching them how money is earned diligently by giving them minor errands to perform and pay them for their effort.
9. Even financial advisers can help parents in educating and training their grown-up kids, through small-ticket investments, as tapping them young and servicing them well could also help their own long-term interests as these young investors go up the ladder, through upfront/trail commissions.
10. A timeline of financial awareness experiences for kids could be:-
a) 5-6 years: Fun experience with identifying coins and bank notes
b) 7-9 years: Wallet and piggy bank pocket money experience
c) 10-11 years: Child bank account full operating experience
d) 12-14 years: Online teaching portals experience
e) 15-16 years: Budgeting and goal-based saving experience
f) 17-18 years: Experience of education loan, investing and part-time job