Children can learn logical principles from the early age of only four. By the young age of seven, they are very capable of solving completely complex problems and have the ability to relate to the feelings of others. Teaching children about money can benefit them by teaching them more than just how to purchase things that they want; it can teach them responsibility.
Many children receive birthday money and it is often a large source of their income. This is a good opportunity to teach them about saving money. Instead of buying items for them between holidays, allow them to save for them and purchase them. They will be excited and proud when they take the trip to buy the desired item because it will have been earned.
Christmas lists for parents are often a difficult time financially because many times children do not understand that there are limits in this case. If Santa is still in the picture then allow the child to place the most important items on this list, requesting that they limit them as he is very busy. Then provide them with a budget for the parents list. Tell them to choose whatever they like as long as it stays within the budgeted amount. This is a great way to teach kids about money. This allows the child to realize that items do have a price and they learn to scrutinize their own selections.
For small kids, saving pennies can even be important. Allow them to save theirs, and match whatever they save for encouragement. Young children will be very excited by this and it provides them a way to purchase wanted toys.
For kids that are old enough to help with simple tasks and receive an allowance it should be started as early as possible. Learning to work for money is something that needs to be taught very early. Assign a particular task list to be completed daily and when these tasks are completed they can be paid either on a daily or weekly basis depending on their age.
If at all possible, take your children to visit your place of business. Allow them to get the idea that parents actually do not play all day while they are at school. It is important for them to see that life will be a transition into working and that things will not be given to them.
When teaching kids about money, try and make it fun and they will be interested in learning about this topic more.