It’s important to cultivate healthy financial habits in your kids while they’re young.
Unfortunately, many parents find out too late that they may be unconsciously passing on their bad money skills to their kids.
After all, children are highly perceptive. You don’t need to wait until their teens before they start following in your footsteps.
Here are just some money mistakes that you don’t want to pass on to your kids.
Overspending
Spending can make or break your finances.
When your kids see you buy anything you want without a second thought, they’ll grow up thinking money is no object.
But remember, money is a finite resource, even if you have millions in your account.
So if you can’t afford to overspend, make sure you get a bang for your buck.
Look at the price tags when grocery shopping and compare the difference between brands.
Opt for cheaper variations if you can, especially if they taste the same. Avoid going for designer names just because they’re trendy.
Indulge only once in a while.
No Savings
This goes hand in hand with overspending. After all, if you overspend, of course you won’t have any money for savings.
In fact, in this day and age, just saving money is not enough.
You also need to teach your kids the value of investing wisely.
Not Budgeting
Budgeting is important especially if you’re looking to bulk up your savings.
But it’s important to know where your money goes. Once you have this information, you’re able to plan your budget effortlessly.
The only thing that makes or break your financial plan is your discipline.
Because what kids will remember most is not numbers or charts. It’s their parent’s behaviour and self-restraint.
So reassess your relationship with money and spending, there may be something unhealthy underneath it all.
Collecting Debt
One of the most dangerous financial habits: collecting debt.
The thought of paying for something ‘later’ can be tempting for children.
But nothing comes without a price. The same goes with borrowing money.
Whether it’s student debts or car loans, always be responsible and pay on time.
Don’t encourage them to take debts by taking on more debts yourself.
This includes paying instalments for things like furniture and appliances. They will develop an unhealthy mindset about debt.
This is especially so if they see you do this in their teen years where they begin to understand more about where money comes from.
Impulse Buying
Buying anything you want on a whim is a luxury all of us want.
But even if you’re a wealthy parent, buying stuff off the shelf just because you can sets a terrible lesson for your kids.
Not only is it unnecessary clutter, it also encourages your kids to ask for things even when they don’t need it.
When shopping with or without your kids, only buy what you need.
Save the wants for a future indulgence.
Financial Secrecy
Parents often want to keep their kids blissfully ignorant about the adult world.
And this includes finances.
There can be good excuses for not discussing money with your children.
You may be hitting some financial pressures and don’t want your kids to worry about their security.
But its important to be transparent with your kids with how you earn, spend, budget, save, and invest your money.
It will give them a healthy preview about what awaits when they’re eventually old enough to start handling their own wealth.
Teach Kids Good Financial Habits
We pass on many things to our kids. Our good looks, our heirlooms, and unfortunately, likely our bad financial habits too.
These are the rare cases of nurture overriding nature. By being more responsible with our money, we teach our children to do the same.
Money management is so important in this day and age. We need to be wiser about our wealth.
And hopefully we as parents can help set our kids up for financial success for decades to come.
You’ve got this, parents!
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