Money! How do I explain the topic to my child?
We Swiss are taught from an early age not to talk about money. The more important lesson, however, would be the right way to handle money. We give you five tips on how to explain money to your children.
1. talk about it.
The wallet should not be a taboo subject. Especially not in the nursery. We should explain the topic of values to our offspring from an early age. After all, they need to understand that money doesn't grow on trees and must be handled carefully and thoughtfully.
Helpful learning methods are uncomplicated and work on the principle of "learning by doing". Simply take the little one to the grocery store every day and show that different products cost different amounts. After paying for the groceries, you can explain how much everything cost - and why there is a price difference depending on the product.
And of course, the price includes not only the material value, but also that of the work behind it (production, transport, supermarket staff, etc.). To explain the value of labor, it is suitable to assign from time to time small tasks in the household, which are then rewarded with a "chunk".
Also show the benefits of saving money! And at the same time in the matter of pocket money, or even when it comes to the summer vacations. Explain why the trip and the hotel will cost so much and how you can easily pay the amount thanks to regular savings.
2. the good old pocket money
You usually never learn as well in theory as you do in practice. Especially when the practice can also be fun! That's why we highly recommend giving your offspring a modest sack money around the age of six. It is important to do this regularly and not to give advances or exceptions. After all, this is how you encourage the ability to divide the money up over the week - and that, after all, is the first lesson of budgeting!
Less pocket money after a bad math test? We strongly discourage that. Pocket money is about the child learning personal responsibility. And monetary punishments do not promote healthy money management at all.
3. keep a cash book
Admittedly: This sounds a bit dry. But it should not be underestimated how many educational advantages keeping a "sack money book" has. For one thing, the child can plan better for the next month after the first balance, for example at the end of the month. And for another, it encourages appreciation of various things that cost money. When the little one sees that he has already spent all his money on Panini pictures after just one week, but has practically always had to end the snack break for them with an empty stomach, this can stimulate thinking.
4. learning to save
The ten francs per week are never enough for a skateboard! - The junior will complain until he or she is introduced to the idea of saving money. Create a savings plan with your daughter or son for something big they want to afford. With a simple calculation, it quickly becomes clear how much bag money needs to go into the piggy bank each week until the big day finally arrives. This not only promotes the fun of saving and frugality itself, but also teaches that dreams that cost a lot of money are better thought over for a while. Because who knows? Maybe after a few weeks the skateboard won't be the biggest dream anymore.
5 From pocket money to budget money
From the age of 14, it is worthwhile to provide a budget money in addition to pocket money. This can be transferred monthly to a bank account and is used for living expenses such as clothing, cosmetics, transportation or even bicycle repair. Such a budget money avoids the unpleasant discussions about desired clothing and gives the daughter or son a certain sense of freedom and responsibility. The important thing with budget money is that you support the child in budgeting. For this, the use of an app is suitable, with which one can manage his expenses and income well and always has an overview. This way, the offspring also learns how to use the necessary tools at the same time, which will also make dealing with money uncomplicated later in life.
That's it! But it's not just children who need help and explanations when it comes to finances - we adults feel the same way, precisely because the world gets more and more complicated as we get older. But that's exactly what we're here for. Get the Caveo app now and get free and complete advice on all financial, insurance and pension topics. Direct, uncomplicated and 100% digital.