How to teach children to value money through simple tasks at home | Easy Parenting

Nowadays, children are born and raised in luxury. Family incomes have increased tremendously, and the number of children has reduced. Consequently, children see abundance in life with plenty of money around them.

While this is a good sign, pointing to better standards of living, at the same time, it very important to teach them to value money and handle it with care so that they grow up on a strong foundation, with a mentality to spend money wisely.

Before we discover how to teach children to value money through simple tasks, it is important to understand a phenomenon commonly occurring in fast-developing countries like India, China, Brazil, Indonesia, Russia etc.

The Six-Pocket Syndrome

In the countries mentioned above, people work hard to improve their living standards. Consider a couple where the spouses are career oriented and have a child. Let’s call this child ‘A’. Imagine a similar couple with child ‘B’. Another assumption is that both couples have only one child each.

Now A and B are raised in reasonably well-to-do families and have access to good education and career options. Imagine A and B get married when they grow up and have a child named, ‘C’.

If you consider child C’s situation, he/she is upwardly mobile, very well-to-do parents A and B. At the same time, this child also has four very capable grandparents who are possibly still working at the zenith of their careers. In this situation, there are six people, four grandparents and the parents A & B to take care of only one child. This child literally has six pockets to spend from. This is called Six-Pocket Syndrome. This is witnessed in fast-developing countries where people are having fewer and fewer children, but their incomes are steadily climbing. These are the richest children in the world, richer than their western counterparts.

This syndrome may not be exactly witnessed in every family, but more or less the condition of children raised in urban areas is close to it.

The need to teach children to value money

As childhoods are becoming more pampered and enriched with resources, it becomes very important to teach children to value money, because life can be tricky and conditions can change like seasons. If children are raised with strong values, they can grow up to enjoy good times while having the inner strength to sail through difficult times.

How to teach children to value money

It does not take much to train children to value money. Simple activities can be made part of daily lives to make them realize the value of money and spend it wisely.

1.Don’t Dole Out Pocket Money – Instead of simply handing over pocket money to them, ask them to earn it every month. Make it a fun activity rather than an imposed responsibility. Ask them to take over some household chores and monitor them for consistency. Keep a simple logbook for record keeping, monitoring how many days they carried out the task and how many days they skipped. Then pay them accordingly at the end of the month. Before setting up this rule, sit down and have an engaging talk with them so that they can participate in the activity willingly and happily. These tasks, for example, can be – walking the pets, tidying up the house every day, watering the plants regularly, baby sitting younger siblings, laying out the dining table, doing laundry etc. You can think of many similar tasks depending on their age and abilities. These tasks can vary from family to family, but make sure to assign only repetitive tasks so that they can be monitored for commitment and regularity, basis which, you will pay them pocket money at the end of the month.

2. Budget Gifts – Whenever you want to bring them gifts, such as on birthdays or festivals, instead of simply bringing them or fulfilling their needs, give them a budget for every occasion and let them choose what they want. Of course, you can always be there to guide them, but let them choose within the budget. That way, they will learn to value money and understand money’s buying power.

3. Task-Based Gifts – If they ask you for something beyond their regular pocket money or festive gifts, such as a new mobile phone or a pair of premium headphones or a paid subscription to something, unless absolutely necessary, don’t hand it out to them immediately. Instead, if you agree on fulfilling the request, talk it out with them and tell them that they can have it, but they will have to earn it. Agree on a timeline and give them a task which they will have to accomplish to rightfully expect the desired item.

The duration and the choice of the task can be selected mutually depending upon the magnitude of the demand, the age of the child and necessity of the demand. Items that are necessary, such as school or sports accessories, can be provided without any such tasks, but those items that are non-essential can be given after completion of such tasks. Examples of these one-time tasks can be – helping in the kitchen for one month, teaching younger siblings for two months, helping decorate the house for an upcoming event etc. The size and duration of such tasks depends on the value of the gift requested.

4. Budget Recreation – Give them a monthly budget for pizza parties and movie outings in terms of money value and let them choose what they want to spend it on, prioritizing between options. If they exhaust their budget, a dry period will exist till the end of the cycle for the budget to be replenished.

5. Monetary Rewards – Rewarding good behavior and achievements is not new. This tradition has been going on since ages in most families. However if monetary rewards are used in combination with the above strategies, albeit sparingly, children can become very protective about money as by now, they must have already realized how difficult earning money is.

Listed above are some of the day-to-day strategies for teaching children to value money. All of them may not be applicable to every family, so check what suits you, evaluating the feasibility along with the age of the child and your unique situation.

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At no point in time should these activities become suffocating for the child. Make it a fun-filled activity, using your discretion to provide flexibility, otherwise they will not produce desired results.

It will be successful only if the child is convinced and is ready to happily participate. For this, you will have to explain to them why it is important and give them incentives when they see that willingly participating in this may give them more than otherwise.

Agreed you might have to spend a little extra sometimes, especially if they become very efficient and carry out all assigned tasks perfectly and on time, but that’s what you wanted, right? In the bargain, you will see the child is slowly learning to value money – a lesson worth learning!