WITH children now settling into the new school year, now is the perfect time to help them form new, positive habits that will set them up for success for the school year and the rest of their lives. The fact that most students have also returned to face-to-face learning also presents a new opportunity for them to learn personal financial management.
Candice Heaven, personal banking officer at Sagicor Bank, shares these tips for ensuring that, along with having excellent grades this semester, your child also develops habits that will put them on the path to financial success.
Teach them the importance of saving
Good financial habits start with education, Heaven says.
"Before you allow your child to have the awesome responsibility of spending, teach him/her the value of saving and setting financial goals. These can start off small at first, such as encouraging your child to save pocket change to buy their own ice cream on the weekend, then scale the goals up by encouraging them to save for more expensive items that they like," she suggests. "You should also encourage them to save regularly, even if they don't have a goal in mind just yet. Most children get really excited just to know that they have money."
Give them pocket change
Heaven also recommends that you use the return of face-to-face learning to develop your child's money management skills.
"Giving them a set amount of cash each day or week for school is a good way to introduce them to the value of money and good spending and saving habits," she says. "Even if your child's school has a lunch programme or you're sending them with food, you can give them a small amount of money each day for them to use as they please, while encouraging them to save. For older children, you can increase the level of responsibility by giving them their lunch money for the entire week at once and allowing them to budget."
Create opportunities for them to earn
"A great way to encourage an entrepreneurial spirit in your child is by helping them to find ways to earn more money," Heaven suggests. "You can put a monetary reward on small jobs around the home that they can volunteer to help with. You can also assist them to monetise their interests or start small businesses that can be supported by family members, friends, and neighbours."
Publishing a book online, selling art and craft items, having a fruit or pastry sale, helping neighbours with their gardens or washing cars are some examples of ways children can earn extra cash.
Introduce them to banking
A bank account in your child's name is an excellent way to introduce him/her to the formal financial system, Heaven adds.
"Teach them to save in a bank account that is specifically designed for children, such as a Sagicor Bank Star Savers account," she suggests. "Not only does this allow them to personalise and keep track of their own finances, but it also gives them a head start by familiarising them with concepts they will need to know for adulthood, such as good credit, interest rates, and how to access additional funding when needed."
Include them in family decisions
The personal banking officer underscores the need for parents to be good role models of personal and financial wellness as a strategy to pass on important values and practices to their children.
"One of the ways to do this is to include the children in family decisions," she says. "For example, let them help to buy each other presents, plan weekend activities and vacations, and have working knowledge of mortgages, bills, and other expenses. Also explain the reasoning behind your financial decisions so they can learn to evaluate big decisions on their own."