15 Oct 2009

Future Wealth

“Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime.”

Could the same Chinese proverb be relevant to the way we teach our children about money?

When is the right time to start teaching our children the value of money and the benefits of saving for specific goals?

“Mum, can you buy me the new Ben Ten toy?” said Michael, aged 7. “No, we don’t have the money for another toy this week” replies mum. “Well, why don’t you just get some money from the machine at the shop?” demands Michael.

When we need money, our children see us going to an ATM. When we go shopping we are increasingly paying with a credit card and the checkout operator asks “Do you want cash out?”

Thanks to the increasing prevalence of advertising, our children today also have very sophisticated retail requirements. Children are far more aware of the latest ‘must haves’ whether we are talking about Matchbox cars, Bratz dolls, mobiles, iPods or Nintendo DS games.

For kids

Deb Humphreys is the owner and director of Minding My Future Pty Ltd. Her goal is to be the leading and preferred supplier of financial educational products that give children the opportunity to live an abundant life through planning for financial success at an early age.

As our children grow older, our opportunity to teach them how to manage money increases.

Do we give them opportunities to earn money so they can save to buy things for themselves and learn the value of saving and delayed gratification?

Pre-teens could be encouraged to put a portion of their pocket money into a savings plan or an online bank account. Teenagers could be encouraged to get a part time job and put their wages into an account to increase their savings. Young adults (18+) can open a “First Home Saver Account” which is an assistance program based on their yearly savings.

Conditions apply, but savings of up to $5,000 over four years could reward them with an $850 contribution from the Government (with the interest on the earnings being tax free!)

Most would agree that our children need to take more responsibility with their money. If we start early we can encourage our children to learn the value of money and some good old fashioned saving skills, setting them up for a brighter, more secure future.

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