Dads are strong, wise, patient, and hardworking, especially in the eyes of their kids. In fact, most kids would agree that dads are modern day superheroes. Dads can solve problems and open jelly jars with their immense hand strength. Go dads!
But what about money management lessons? Is this a superhero power dads can pass down to children — And moms too? Money management lessons learned at an early age can often instill good money habits later in life.
Like most things that have to do with kids, modeling behavior can make an impact. This holds even more true when financial wellness is part of the equation. Sure, school will teach kids a bit about financial facts of life, but certainly not all.
Dads can play a big time role here. First, you may need to brush up on your financial literacy. Then it is time to transfer that knowledge to your kids. This can begin as early as four years old.
The following important money management lessons dads can teach kids may serve useful. Let’s dive in superhero dads!
This is a very important money lesson for kids, because if you don’t make money management learning fun, your kids will lose interest pretty fast. How can you possibly make anything financial for kids fun? You just need to get a little creative.
For example, if you’re planning a family vacation, let the kids plan a day activity that they would be interested in. This is great for middle-school children. Give a budget, a list of activities, and let them budget in some family vacation fun.
Most kids see money as something spent. Dad goes to the store and buys groceries, money is spent. Dad needs to fuel up the car, money is spent. And the money spending goes on and on. Children see this, because it is a person-to-person exchange.
What kids don’t see is the saving part. This is due to the simple transfers to savings accounts done online. And saving money is a very important money management lesson dads can teach kids.
You can teach kids about saving money a few ways. One way is to show them that dad saves money. Instead of completing the online transfer, take your kid to the bank so they can see the actual savings transaction take place. You can show them online after that.
Dads can also set up a savings jar for kids. Giving kids an allowance weekly is a great way to instill good money habits long-term. Having them put money into a savings jar each payday can build on the importance of saving money.
The exchange of actual green paper money is almost non-existent today. Most people swipe a debit or credit card to pay for goods and services. Kids see this, and dads can teach kids about these magic cards with money on them early.
You can begin with debit cards, since they are slightly easier to understand. Show your kids that the debit card is not magic. You can bring up your balance online to highlight that money needs to be present for a debit card to work.
Dads can also team up with Treasure to drive this important money management lesson home. Treasure is a mobile financial app that teaches kids about money. Soon the Treasure debit card will be available for kids to use and learn more about how money management and cards work.
Teaching kids about credit cards can be a bit more challenging. It is still challenging for us adults. The concept of credit, and not overspending will have value, but maybe skip the credit score teaching moment until your kids are in high school.
Making financial decisions is an important part of teaching kids about money management. Dads can convey that every financial decision has two sides. This can help kids make sound, thought out decisions when it comes to spending.
When your child wants the latest and greatest toy, you can discuss the cost and benefit of making that purchase. For instance, if the toy costs $15, and your son or daughter has $17 in their savings jar, you can highlight that nearly all the money in the jar will be gone.
You may be surprised by how much thought will go into buying that toy after your child has a visual perspective of how much hard-earned money will be gone.
Dads can make a positive impact, as well as moms, on a kid’s future money habits. The above money management lessons may prove useful. You may even be doing a few, or all of them, already. Keep being awesome dads!