Money…. The demand for it never decreases, whereas its supply is never enough for us.
We always tend to spend on items which we like or the items which are trending in the market. We want everything that makes our life comfortable. We develop wishes one after another. That means, our wishes are never going to end.
As grown-ups, we might think about money and budget before demanding anything. But, do our children do the same? Well, they do not know how to spend and how to save. It is so because they have no idea about money mechanism. We really need to tell them and update their thinking by giving them a gist of it.
Most of us don’t tell them this because we think that they will learn this in school. But we all know how our country’s educational system is. Most of the syllabus is not useful to the students in future. Therefore they just mug up everything for the sake of marks and then forget the same. And money mechanism is not something to forget throughout the life.
What does money mechanism say?
Your child must know where does the money come from. How is the money earned? They must know who are the earning members in the family and what do they do to make money. They must pay attention towards the spending habits as well. We come across so many teenagers who are not aware of what happens by saving and investing. This is so because their parents might not have tried to improve their vision regarding money.
Most of the children forget to differentiate between need and want. They want everything better than what their friends have. Mostly they spend to show off.
We need to teach them to understand the necessity of things. Before buying anything we must question ourself, “Is it a necessity? If yes, then how much of it is needed?” and then purchase accordingly.
Apart from all this, teach them how to save and invest. As they are growing up, it is important for them to understand the need of saving and investing. It is better to open an account in the bank instead of giving them money as “pocket money”. They must know how interest is earned. How the banks work. Let them explore the world through the access of internet, newspapers and other such mediums.
Also, teach them to beware of various marketing strategies. There are so many advertisements which are specially made to attract the teenagers. Therefore, a smart man will always make his children aware of them. They must analyze the way market works.
Why discounts exist and why prices increase or decrease with time? If our children are too innocent to understand these strategies; it is our duty to teach them and save them from this trap.
Another thing they need to know is- “scarcity”. Why do we need to choose one out of so many alternatives? Because, as I said- wants are never going to end. But we need to utilize the money to its optimum capacity. One must choose the best out of available alternatives. Also, at times we need to prioritize our needs as per availability of money. There are some basic necessities without which our life may stop. So they are to be satisfied first.
It is parent’s responsibility to make them aware. Being a parent, do not completely depend upon schools and colleges. Start teaching them the inflow and outflow of cash from today itself. They are going to be the future of our nation. So let them understand how does finance work.