Do your kids know the ABCs of money?
Nowadays, Indian economy is surely not hunky-dory and therefore, we find that even adults don’t know how to manage their finances properly. Given the situation, we have to start training our kids on the basics of money as well as managing finance.
As your child goes to higher grades, you can start introducing him/her to the fundamentals of our domestic and global economy. However, for kindergartners, teaching basics like wants, needs, scarcity, choice, goods, and services through simple scenarios are vital. As you go further, teach them about barter, saving, income, budgets and resources.
To begin with, give your child a fixed amount of pocket money per month and ask him/her to keep track of the expenses throughout the month, even if it’s just a candy costing a few bucks. If he/she falls short of money, encourage him/her to ask but in the same breath, teach the concept of deficit. When your child walks up to a store wanting a particular brand and finds a more expensive one, then know that it’s a good scenario to start talking about demand and supply vis-à-vis price.
Therefore by the time your child reaches, say, eighth grade, he/she will be able to relate to concepts like trade-offs, markets, recession, inflation, entrepreneurship, imports and exports, interdependence, credit and debit, and exchange rates better.
Even children can develop healthy habits of saving money. A piggy bank full of change goes a long way as the kid grows. It’s about the mindset he/she learns.
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