As your children get older, they would need to start developing their financial independence. It might not yet be the time for them to look for a part-time job, but inculcating some habits in them might prove to be beneficial as they get into adulthood.
- Open a High Yield Savings Account
Once your children are mature enough to be able to grasp the concept of interest, you could open a savings account with an interest rate. You might guide your children into opening a high yield account online and at the same time would be able to explain the concept of compound interest.
- Help Your Child Prioritize
You might want to help your child prioritize by making them draft a wish list of all the items that they would need to spend money on. Ask your child to consider the long term rather than just that cool trendy object that they wish to buy. For instance, they could start saving for a trip to Europe or to buy a brand new laptop. Then you could guide your child to allocate a portion of their allowance to each of these goals.
- Let Your Child Make Mistakes
If you child want to spend money from birthday gifts or from their grandparents’ visit, a good idea might be to let them do it. Poor decisions might sometimes serve as one of the most important life lessons for your children. Assuming that the money is not a big amount, it does not constitute so much of a financial loss if your child does not save it up.