Psychologist Emma Kenny has shared her tips on discussing money with children, read her tips here.
1) INTRODUCE YOUR CHILD TO THE CONCEPT OF MONEY AS EARLY AS POSSIBLE
Whether it’s through play or simple observations in and outside of the home – try to look for opportunities to introduce your child to the concept of money.
This could be as simple as giving your child their own mini budget to buy something when you do your weekly shop – whether that’s a snack or a treat like a colouring book or crayons, enabling them to make choices within their budget.
These early conversations are important as they can help your children to understand the concept and value of money, but also help to set a positive and confident financial foundation, which could help them later in life.
2) HELP YOUR CHILD APPRECIATE THE VALUE OF SETTING AND REACHING SMALL GOALS
Whether you give your child a little pocket money for good behaviour – or for doing small chores around the house, such as keeping their room tidy – earning a small reward helps to bring a sense of satisfaction when they finally reach that all important goal.
Psychological studies have shown that delayed gratification is important for children to experience as in the short-term it encourages self-control and patience.
While in the long-term, it can help contribute to academic success, social responsibility and a greater capacity for dealing with stress and frustration.
3) TRY USING THE THREE ‘W’S’
When your child asks for a particular item, a practical tool you could use to help them think more about how they are spending their money is the three W’s:
What is it they want?
What is it for?
Why do they need it?
By using this approach and encouraging your child to answer these questions for themselves, you are encouraging them to consider their choices.
This is a life lesson that your child can carry with them as they get older and it will help them develop a sense of gratitude for the items they do receive.
4) MAKE LEARNING FUN THROUGH PLAY
Interactive activities, such as counting money, playing shop or reading a poem or rhyme, are tried and tested methods of helping children to better understand the concept of money.
The benefits of bringing learning to life through interactive play are multi-fold and include children becoming better problem solvers – with an increased ability for critical thinking – nurturing creativity and imagination, and building skills such as compromise, conflict resolution and sharing.
When it comes to playing shop, to help children learn and engage you could try adding price tags to different priced items, such as toys, alongside everyday items, such as fruit and vegetables, as this will help your child see the value of different items alongside each other.
5) SHOW HOW MONEY CAN BE BUDGETED AND SPENT IN DIFFERENT WAYS
To help your child understand that the family budget accounts for more than just the physical items they can see – such as the weekly food shop – you could share practical examples of your family budget, that are easy to understand, and that your children can get involved with.
This could be something as simple as allocating a small amount each month to a family day out or activity and then involving your children in deciding on what the day out should be – you could explain that if they go for a picnic one month, next month they could all go to the zoo.
Not only does this help your child understand the different ways the family budget is spent, it gives them a sense of excitement and responsibility.
6) HELP THEM UNDERSTAND DIFFERENT WAYS TO PAY, SUCH AS DIGITAL AND CONTACTLESS
One of the challenges parents said they have when teaching their child about money was helping them understand the value of money in the context of digital payments.
To help overcome this, when you next talk to your child about money – or play shop- you could try using a range of different payments – including cashless payments such as contactless and card transactions – so it becomes familiar territory.
When you are shopping online, you could also show them how digital payments work.
Do you have any of your own tips to share?