Children are much smarter about money than adults can fully comprehend. Money management can be introduced to them at their intellectual level, and children can usually comprehend the meaning and significance of these lessons. According to HCR Wealth Advisors, a registered investment advisory firm, children should be introduced to the basic fundamentals of money management through financial training that specifically matches their young lives and daily activities.
Children should earn an allowance for household chores. It is the easiest way to get them to have an appreciation for money. When a child is given chores, such as emptying the dishwasher or making sure the garbage is left for weekly pickup at the driveway, they’re earning their way. They come away with a better understanding of how money is earned.
As mentioned in an article published at Glassdoor, once a child has earned their own money, suddenly, they become more protective of it. That is the perfect time to help them set up a budget. A child can appreciate the same income and expense factors that you understand with a job and a mortgage. Many of HCR Wealth Advisors clients know the value of money and were taught those same values. A budget is the core foundation of knowing the value of money. HCR Wealth Advisors believes that clients who have that basic fundamental understanding are more likely to benefit from being financially counseled.
A perfect opportunity to get your child to save is when they want to buy something. Instead of handing the money out, help them establish a savings pattern to purchase the item themselves. Every child should have a savings account, regardless of their age. Help them understand how their money can grow by calculating the savings for an established time period, which is a first step in investing.
HCR Wealth Advisors (@HcrWealth) wants parents to understand how important their role is in the financial education of children. HCR Wealth believes it helps long-term. They become adults with a stronger foundation and understanding about money management for investing in their future.
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