ARE you teaching your kids on financial literacy? It’s never too early to introduce the subject of money, as knowing how to manage it is a lifelong skill that will see them through good and bad times. But it’s a skill that should be taught from an early age.
Financial literacy is briefly covered in many schools across the world, Zimbabwe notwithstanding, but it is ultimately your guidance that
is needed to ensure your child’s financial wellbeing is met. From training them on saving, budgeting and even on the ideals of hard work and earning a living, you will be securing sustainable financial futures for them.
Susan Tanaka Sitemere, Country Manager, Zimbabwe and South Africa at international money transfer company WorldRemit, has a few tips to help you teach your children to be money savvy as they grow into adults.
1. Let’s talk money
In many Zimbabwean households, parents may not want to chat about family finances in front of their children, but to nurture a child who’ll be in good financial shape as an adult, it’s really worth starting the conversation early – without, of course, bringing up any real financial worries.
So, consider chatting with the kids from an early age about routine purchases like food, paying for education, transport, and holidays. Discuss the difference between the things you need such as food, water, heating, and the things you want – holidays, technology and clothes or shoes, like the latest trainers.
When they’re young, take them shopping, look at the price labels and pay for items with cash, rather than paying with a seemingly ‘magic’ credit or debit card. Cash is a tangible thing – once it’s used, it’s gone. Kids need to learn that.
2. Introduce them to money
As soon as your child can count is the time to introduce them to money. Show them some Zimbabwean or US Dollar notes and coins and teach them the value of each one. Best of all, play some money games with them – engaging games to help them understand the value of coins, how to count money and work out change.
You can play these games online or as board games. Introduce games like nhodo, tsoro or draughts1, which can enhance counting skills and fast thinking. You can also create your own homemade games. After all, what child doesn’t love setting up and playing shop? Play and learning really can go hand in hand.
3. Get them budgeting
Whether your children earn their own money with an after-school job or get gifts and pocket money from their grandparents during their birthday, it’s worth introducing the idea of budgeting early. And make it fun!
Yes, budgeting really can be fun if you draw up a colorful chart for them to fill in
. Two columns: ‘money in’ and ‘money out’.
For younger children, they can put their money in three different piggy banks or jars – money for spending, for sharing/gifting, and for saving.
By budgeting, your children will begin to take more personal responsibility for managing their money.
4. Start them saving early
It’s important to teach your children that however much money they may be given or earn – they don’t need to spend it all at once. It is far better to set some goals and save for the future!
So, help them open a savings account – a digital savings account may be best. After all, our children will be doing most of their banking online in the future. The earlier you get them managing their finances on a computer, tablet, or mobile phone, the better.
Once they have a savings account – you can look at the monthly statements with them – and explain how the account grows because of deposits and interests. Fortunately, most of the banks in Zimbabwe have child-friendly bank halls and children’s savings products2. Encourage your older children to put larger sums away for something they really want like a new bike or computer.
By saving your children will learn how rewarding self-discipline and goal setting can be.
5. Working for the things they want
When your child sets their heart on anything from a book to a bike, instead of instantly reaching for your credit card – encourage them to earn the money for themselves. No one wants work interfering with their children’s studies or play, but there are small jobs they can do to earn a little and pay for the things they want.
Young children can top up their piggy banks by doing household chores. Teens (10- to 12-year-olds) can do babysitting, or gardening. And older teens can get part-time work in shops, local restaurants, and holiday work in cafes or at attractions.
The benefit of this? To give them the responsibility and self-satisfaction of earning their own money and saving from a young age. In this way, they can really understand and begin to appreciate the value of money.
6. Spending not overspending
Now comes the really fun part. Once your child has saved the ri
ght amount, they can go shopping and then spend within a budget. Of course, advise them not to overspend. But as long as they’re ma
ture enough, it’s best to leave the purchase decisions to them. They really need to be in control of their own decisions when it comes
to money.
If you help them become smart spenders, you’ll instill in them some valuable lessons about how personal choice relates to managing money.
