Money Management

Money Management

What is the right to give an allowance your child?

The best time to start is when your child entered in elementary school since he is beginning to have importance responsibility then.  The goal is to teach your child how your handle money well; make sure he understands this purpose.

“When I was a child I’m getting my allowance since I entered kindergarten worth P5 pesos during that time that money worth a lot.  Entering to grade one to two it’s increased by P5 pesos which I had P10 pesos in hand then I also learned to sell foods to my classmates so I can earn money. But when I was transferred to a private school of course my money increased a lot to P10 pesos to P30 pesos.  For that money I always save P10 pesos on my pocket since then I save a lot of money that can buy my favorite jeans on the mall. “

“By saving money left on your pocket everything is possible like what I did to the money I saved I didn’t imagine that I can bought an expensive jeans and shirt. ‘’

How much depends on what you on what you can afford as well as needs of your child.  According to studies suggest that considering the average amount given children of that particular age whose family values are similar to yours. If the money you give your child is for lunch and recess, add a little more so you can learn to save. If your child receives P40 pesos and every centavo is accounted for, he does not learn the idea of “planning ahead and saving money.”

The awareness of the value of the money may start even earlier. Set limits on younger children who constantly ask you buy them things. Say that new toy or candy can only be brought once a week or every pay day. How much money can spend? Tell your child about this before you enter the store. When he knows what to expect, he will not get disappointed. You can even have a little practice session making choices. Get two times or m ore, then let your child choose which one he likes.

How to spend money wisely?

Your child has to see the difference between “needs” and “wants”. Needs are the things that are necessary, like clothes and shoes that are used in gathering and school. Wants are the things that your child wants to have, such as toys and foods. You should tell him that needs are given more importance than wants.

“I can say to myself that I’m not a great or wise shopper because boys are buying everything he likes unlike girls that are searching for the best one before she will buy it. But when the time goes by I learned how to buy things that are affordable but you can see the quality of the product. They are a lot of people saying that the expensive things are the best than cheaper ones. But probably that is wrong because they are a lot of things that cheaper that you can see the durability of the product and also the quality.

Guide your child into becoming a smart shopper: check the product carefully, compare prices, and get the best price. Discourage him from buying impulsively.

Despite your guidance, children will mistakes as part of the learning process. If the uses up his money to buy a toy only to regret the decision when he sees a better one later on. Allow him to live with his poor choice without being blamed or ridiculed. Ask him what he could have done differently to avoid the same things happening in the future.

When your child is saving or buying wisely, encourage his efforts. Giving the time and attention teaching him will eventually help him to understand and appreciate money.