Teaching Kids How to Stay Safe with Money
Teaching children to develop a healthy and responsible relationship toward money management is up to the parent. Experts believe children should learn about how money works as early as five. Learning how to spend wisely is equally important as staying safe with money. That includes avoiding pitfalls that lead to thefts, overspending, and other issues.
This guide focuses on how to teach kids to stay safe with money. Here are the steps to help your child understand how the spending works at any age!
Teach Them Where Our Money Comes from
It all begins by underlying that nobody gets an endless supply of money. Children should understand the sources of money. For them, it could be a birthday gift or pocket money they receive from parents. Doing chores and helping around the house is another way for them to earn cash.
The next step is explaining how adults get the money they give to kids. Explain how you go to work every day to earn cash. And if they ask about grandparents, point out they’ve worked for decades and deserved a pension.
Spending Wisely – Making Most Out of Your Money
Teaching children about the value of money what they buy with it for themselves is imperative for any parent. You can come up with a list of chores your kid could do to earn cash. A simple job should be worth $1, but demanding tasks that last hours might be paid $10 or more. They’ll realize it takes effort to earn bigger sums, so they’ll pay more attention to how they spend them.
And while discussing spending the money wisely, point out the “needs versus wants.” Your kid should get limited weekly (or monthly) pocket money. Tell them they shouldn’t spend all the money at once. They should have enough for snacks, playing with friends, etc. If your child goes over the limit, don’t just give them extra money. Use the opportunity to teach them about the loaning concept. Give them a small amount, which will ensure to cover spending on their “needs.” But do that with the condition of them returning that cash from the next pocket money.
Teach Them About the Potential Dangers
Money management isn’t only about spending wisely. It’s about staying safe and avoiding financially-related threats. These could be:
- Friends who ask for a loan but don’t plan to return the money. Your children should avoid loaning anything they consider “a big sum.” Also, if their friend doesn’t repay the loan once, they shouldn’t give them any money anymore.
- The importance of keeping their money in a safe place. Cash shouldn’t be out in the open for everyone to see. It’s better if their money is on a card, and you can find children’s debit cards offered by some banks.
- Keeping passwords and PINs safe. That includes not sharing them with anyone and only logging into accounts on secure networks. Many providers allow locking cards easily if there’s a suspicion of a breach.
Teach Them Online Shopping
Online shopping is a convenient way to order things you need to arrive at your doorstep. It’s a safer way for children to shop since they don’t have to carry cash to the store. Online shopping could save money by allowing price comparison and finding the best offer.
Children should understand they should only buy from legit sites. They should look for encryption certificates, such as SSL. Alternatively, they can stick to Amazon, eBay, or other reputable platforms. If they have any suspicions about the site, children should ask you to check before proceeding with the purchase.
Teach Them Not to Keep Cards Somewhere Obvious
A huge part of money safety is keeping your cash and cards in a secure place. If your child leaves them somewhere obvious, it makes it easier for potential thieves. That’s why they need a secure wallet. And there’s no better way to protect your child’s cards than using an RFID-blocking wallet.
RFID or radio frequency identification enables reading info from credit cards equipped with this technology. It’s how you pay in stores, but that makes you vulnerable to wireless thefts. Thieves that have illegal RFID readers could download your card info and create a copy used to spend your funds.
RFID wallets are critical protection against these thefts. They block these frequencies and ensure no one can read your card while it’s stored in the wallet. That makes them essential for children and adults to use cards. And on top of that, it’s a beautiful accessory!
Check Spending Regularly
If your child has a spending card connected to your account, you should check the balance regularly. It’ll ensure you stay in touch with how they spend the money. It helps to identify every payment because staying in the loop shows whether your child is managing their cash responsibly. If you notice anything out of the ordinary, you can block the card until you resolve the matter.
Teaching your children about staying safe with money is a process. It begins by playing pretend shops when they are little and proceeds to help them manage pocket money later. Learning about money management early is the jumpstart your child will appreciate once they get older. It’ll be less likely they’ll enter cash problems, so your effort would be worth it!
Mariam Simmons is a fashion enthusiast and Content Manager at Alpine Swiss. She loves traveling to the world’s top stylish destinations and gets inspired to create helpful fashion and lifestyle guides. With over a decade of writing experience, her main goal in creating content is to ensure readers learn something useful and provide value instead of noise.