Cents & sensibility: Teaching kids the value of money

In today’s world, children often graduate from high school without knowing much about financial literacy, with parents tasked with teaching their children about money management. Unfortunately, many parents themselves are challenged to teach their kids this vital life skill.



Yet, teaching children financial literacy early on is essential because by learning financial skills and responsibility early on in life, children are able to make better economic decisions later in life.



Start early

According to financial advisor Shituleni Hiskia from Momentum Metropolitan, parents should start saving for their children from birth. He emphasised that teaching kids financial literacy starts with parents being financially responsible themselves. “You can’t teach saving while drowning in debt,” he said.



Many believe they can't afford to save, especially on minimum wage, but Old Mutual advisor Kaumbi Pahee noted there are flexible plans for all income levels. Financial stability, he added, is about using what you have wisely, not being rich. "Parents should be role models because children learn by observing. Thus it is important to demonstrate good financial habits yourself."



Modelling good financial behaviour

Furthermore, he said that teaching children about financial literacy is not just about teaching them about money. "It is about teaching your children that it is not easy to get things in life and that they should work hard to get what they want. Be open and honest. Also talk about your own financial decisions, challenges and successes (age-appropriately, of course).



Buying your child a toy every time they ask for one, creates the idea that things will be handed out to them in life as they grow up. Instead, rather advise children to take on small business ventures like doing house chores, raking the neighbor's yard or simple yard sales ideas such as selling their old or unwanted toys.



Teaching children about finance is a daunting task and needs proper communication and understanding between you and your child. However, with the help of tools such as Junior Focus, families can learn together how to spend, save and make good financial decisions.