Fund Management Lessons to Teach Your Children Before They Turn 10

• Money isn’t Something that Grows on Trees

When children see bills emerge from an ATM, they are unaware that money is a limited resource. Explain that you work to earn money, and the bank is simply a haven for it (try to get rid of your pessimism about the current economic downturn!).

• Make the Best of Your Financial Situation

Giving money to youngsters is the most effective way to teach them how to manage it. It’s a thing if youngsters spend their entire allowance on a new Star Wars figure and don’t have enough money left over to purchase a DVD they desire. They have personal experience with the effects of overspending, according to Joseph Stone Capital.

• Those Who Wait will Get Rewarded

Teaching delayed gratification to children can help them avoid the “buy now, pay later” mentality that can lead to credit card debt. So, as much as possible, stress the concept of patience. Make a handmade pizza with all of your child’s favorite ingredients first, then microwave a frozen store-bought pizza. It takes a little longer to make the handmade pie, but it tastes so much better.

• Don’t Spend it Right Away After You Acquire it

Teaching delayed pleasure goes hand in hand with reducing impulse purchases, according to Joseph Stone Capital. Give an example. Make a budget before you go shopping. Make a list of what you’ll buy, the stores you’ll visit, and the price range for each item. Then go online and compare prices and clip coupons together (consider letting your child keep the savings, so she sees that bargain-hunting pays). She’ll discover that it’s standard to plan purchases before making them.

• It’s Cool to Save Money

Your daughter wants a new doll but doesn’t have the funds to get one? Tell her to put money aside! Take her shopping when she’s had enough and let her pay the cashier herself. She’ll never forget how satisfying it is to labor toward a goal and then get rewarded.

joseph stone capital logo

• Keep an Eye on Things

Knowing where your child’s money goes is a huge step forward in her money management abilities. Make her keep track of her money in a notebook or on a computer. Make a file for her to keep receipts and statements in (or use an old pocketbook).

• Make A Wish List for Yourself

Because it’s difficult for children to prioritize, sit down with your child and write a wish list of the things she wants to accomplish with her money. Then, by analyzing what’s significant about each want, assist her in ranking the list.

• Make the Most of Your Money

Introduce your child to interest-bearing savings products like savings bonds and certificates of deposit. Find a compound interest calculator online and show her how a single dollar may grow with interest over time (or use the Allowance Calculator to see how much your allowance was in today’s dollars). She’ll get blown away!