You don't have to be Warren
Buffett to raise a financially savvy kid. You don't even have to be good at
math. Then how do we do it? Establishing a conversation about dollars and rupees
and keeping it going as your child grows is a possible way. Parents are often
scared to talk to their kids about money. Some lessons mean admitting mistakes;
others signal unattainable goals. But the consequences of not imparting those
lessons on your own kids could be direr than ever. Unlike grandpa, who may have
a pension and employer provided health insurance -- most children now need to
understand much more than basic budgeting.
Kids will need to understand how
to save for their own retirement, manage health care costs and even cope with
diminished Social Security benefits. Sounds like this is jumping the gun? It's
not. Proper preparation of your children, even at a young age, can start them
down the path of a successful financial life. Children start learning about
money long before their first savings account, job or credit card. Begin the
conversation even before they're in boarding
schools by talking about work and money. Avoiding the subject until your
child needs a bank account can make the conversation hasty and confusing.
A trip to the grocery store is a
good time to explain price comparison, value and inflation. An ATM stop offers
a chance to explain that money doesn't actually come from a machine. You can
discuss earned income, investment returns and even inheritance. Opening bills is
a chance to talk about payment for services, credit card debt and interest
rates. Children need to be taught about debt, specifically loans and credit
cards. Talk about insurance with teens, especially as they learn to drive or as
you're selecting what health care options are available to your family. Children
should learn that money doesn't always need to be used for them. It can also
provide assistant to others. Don't just write the charitable check. Get the
kids involved in the process by asking them to pick and scrutinize charities.
What I call best school is one which teach children not
only academics but principles to lead a good life that includes value of money.Don't get frustrated because your
kids don't take your advice. Kids need to make some financial mistakes in order
to understand the consequences. Let kids set their own financial goals, say
financial advisers, or they'll never learn the basics and discipline.
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