Why should we provide financial education to children? Because you want to give your child everything that is best. You want his life to be a happy, prosperous one, free from worries or deprivation. Is that right?
Every parent wants the best for their child.
In the century of speed and consumerism, a “new education” is on the horizon: financial education. Financial education for children will become a “must” of this century. The goal of financial education is to develop those skills, knowledge and behaviors that the child will use throughout his life. All of this will help him in purchasing the goods he needs.
Why should we provide financial education to children?
First of all, many people ask themselves when they hear this concept: “What does financial education for children entail?” This concept clearly refers to money, but does it entail calculations and costs?
No, financial education does not entail calculations, abstract concepts. First of all, the child will know how money came into being, what money is and how it circulates. Financial education brings personal values regarding work, respect, discipline and responsibility.
A child who has seen at home that money is not a taboo subject and that decisions regarding money are discussed will learn this behavior and will act accordingly in his family. Now he begins to learn the “language of money” and to acquire, for later, healthy financial behaviors. This is how financial education begins and is taught to children.
Parents who do not subject their children to discussions about money about what to buy now and what later, raise children who want things and will act impulsively. They will acquire desires to the detriment of needs. They will be frustrated and will learn limiting beliefs about money.
Financial education brings to the forefront the responsibility of tomorrow’s adult. Being raised in a cult of personal finance management, knowledge of the psychology of the human being regarding money: consumerist tendencies, weaknesses and strengths, as well as awareness of the role of time and work put into obtaining money leads to financial balance and health; prosperity.
Definition of financial education:
Financial education represents the set of information, habits, and skills developed regarding personal finances: managing money and understanding the principles that govern its acquisition, as well as achieving financial goals.
Children and money
From the age of 5, children can receive money; money for different tasks they choose to do. These tasks were previously discussed and it was decided that that task would be remunerated. Now the concept of work is put into practice and they will begin to give value to money once they earn it. By making an effort to earn money easily, children will also value every penny they have more.
Financial education has the role of integrating the child into the community and society. Once they have learned information about money and work, they will support their parent to go to work, they will understand why they cannot stay at home with them all day and why they have to go to school/kindergarten.
Why do we provide financial education to children? To be responsible and learn the main idea of money.
Let’s not forget the Romanian proverb: “work is a golden bracelet”. That’s right! Making our children aware that work is the basis of the economy, that we have to do something to receive money, helps them understand, from a young age, the valences of this proverb. On the other hand, if they do not “get their hands on anything when they are little” they will grow up with the idea that everything is theirs and they will have no other source of satisfaction than that of spending money, without learning to produce.
What are the basic principles in financial education for children?
- Money is earned through work. And more precisely: the amount of money depends on the value of the work done. A worker in a factory will earn less than his boss because he is only performing a task. The boss makes decisions and his decisions generate jobs for dozens and hundreds of employees. What a boss does is create value in a community.
- The money earned does not represent the amount that leads you to achieve your financial goals. The money saved from the money you receive will lead you to achieve your life goals.
- Pay yourself first. This is the power of saving by managing your budget so that your expenses are kept under control.
- Money saved can produce more if it is invested. The power of multiplying money is dependent on the time the money is left to be invested.
- Setting the most important financial goals for you motivates you to earn and save, to eliminate the temptation of the moment, the immediate reward, for the greatest reward later.
More about how to provide financial education to your child can be found here: https://www.psihologiabanilor.ro/cand-facem-educatie-financiara-copiilor-si-cum/
Financial education and life
Regardless of the choice of profession, your child, the future adult, will have money and financial goals. Money management: what to spend on, what brings them satisfaction, joy and fulfillment in the long term is the key to financial success. Financial success comes from managing money. Whether there is a lot of it or a little, money has the ability to achieve valuable financial goals if its ability is combined with the human ability to save it, to “train” it.
Children are now laying the foundations of the principles by which they will relate healthily to money for the moment when they will own it, for the moment when they will be independent in earning it. But until then, habits are learned.
Children and needs
A financially educated child will no longer scream in the supermarket for a toy, because he knows that we have a shopping list from which he does not deviate because that is what we established before we left home.
In the financial education of children, we will differentiate between a need and a desire, and the child will recognize both in him and in us, the parents, that we do not make excesses and do not deviate from needs, establishing when we make a desire and planning it.
It is true that at this age, children do not have to fulfill their needs on their own, as they are satisfied by their parents, but it is necessary for them to know them. This way, they will respect their parents’ decision and will value every good they receive, when each need is satisfied. In order to be aware of the need, it is necessary to perceive the difference between need and desire.
A child at 3-4 years old easily perceives differences than similarities. The difference between need and desire will be achieved through play and practical activities. A desire will be differentiated from a need through play. We can also play and have fun with two dolls instead of three. Another practical example can be the one that refers to having one pair of shoes instead of two. One cannot wear two pairs of shoes at the same time; an extra pair of shoes will not give them greater satisfaction, but on the contrary. 😊
Why should we provide financial education to children? The decisive point
Children do not need money, because the need is satisfied by the parents; the entire financial responsibility lies with the parents, but they, the children, can manage their desires. Financial education begins with the management of desires. Managing money later begins with the management of desires when children are young, in order to create the ability to manage money and needs in adulthood.
A better understanding of how we can manage finances and achieve financial goals leads to prosperity and personal satisfaction; material fulfillment.
Children have the ability to understand the surrounding reality if they are given the opportunity to discover it and if it is explained to them. Discussions about money must be fun, practical, and give them the opportunity to practice what they learn. Practice is what we want to transmit. Only in this way will they be able to discern when shopping, and each good will receive appreciation for its true value.
Responsibility and success in life are determined in childhood by the experiences that the child undertakes, and lessons are created step by step from each action and interaction.
We have made an entire plea for children’s financial education, but now it is up to you, the parent, to decide whether or not to provide financial education to your child.
Financial education worksheets for your child
However, if you want to provide financial education to your child, you have materials that we have created specifically to make it easy for you to apply the principles of financial education at home.
Mărunțilă and Bancnoțilă, your child’s companions in financial education, come to the market with a new material: worksheets. This material is an ebook with worksheets in which 6 financial education lessons are “taught” to preschool and school-age children. The worksheets contain exercises and tasks to assess the level of learning of the financial principles transmitted. He is your specialized tutor in carrying out financial education at home with your child.
You can pre-order the material here: https://www.sprijina.ro/cauze/maruntila-si-bancnotila-fise-de-educatie-financiara
Success in raising awareness of money and financial education for children!
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