1. How to teach children about money
You don't have to be Warren Buffett to raise a financially savvy kid. You don't even have to be good at
math. Then how do we do it? Establishing a conversation about dollars and rupees and keeping it going
as your child grows is a possible way. Parents are often scared to talk to their kids about money. Some
lessons mean admitting mistakes; others signal unattainable goals. But the consequences of not
imparting those lessons on your own kids could be direr than ever. Unlike grandpa, who may have a
pension and employer provided health insurance -- most children now need to understand much more
than basic budgeting.
Kids will need to understand how to save for their own retirement, manage health care costs and even
cope with diminished Social Security benefits. Sounds like this is jumping the gun? It's not. Proper
preparation of your children, even at a young age, can start them down the path of a successful financial
life. Children start learning about money long before their first savings account, job or credit card. Begin
the conversation even before they're in boarding schools by talking about work and money. Avoiding
the subject until your child needs a bank account can make the conversation hasty and confusing.
A trip to the grocery store is a good time to explain price comparison, value and inflation. An ATM stop
offers a chance to explain that money doesn't actually come from a machine. You can discuss earned
income, investment returns and even inheritance. Opening bills is a chance to talk about payment for
services, credit card debt and interest rates. Children need to be taught about debt, specifically loans
and credit cards. Talk about insurance with teens, especially as they learn to drive or as you're selecting
what health care options are available to your family. Children should learn that money doesn't always
need to be used for them. It can also provide assistant to others. Don't just write the charitable check.
Get the kids involved in the process by asking them to pick and scrutinize charities.
What I call best school is one which teach children not only academics but principles to lead a good life
that includes value of money.
Don't get frustrated because your kids don't take your advice. Kids need to make some financial
mistakes in order to understand the consequences. Let kids set their own financial goals, say financial
advisers, or they'll never learn the basics and discipline.