Kids should be taught about money at an early age

Just to give you a little background, I grew up having a business minded mentors. They are no other than my beloved parents. Hands on training have eventually shaped my knowledge about money matters at an early age. Though not all family are as open to financial issues and free control I believe it should be taught to the kids at a young age as possible.

Here are some reasons why parents must consider teaching money to their children.

• The benefits of teaching your children about money can be both short and long term. Let your children help you determine how to teach them. Use their questions to develop lessons.

• Explain to children that money is earned. Consider paying them for helping with certain chores.

• Use a piggy bank to help teach about savings and interest. Set a savings goal to encourage your children to save some of their allowance. Calculate how much is saved each month and chip in a certain percentage as interest.

• Take your children to the bank to open a savings account requiring a lower minimum deposit.

• If you extend credit, issue an IOU, set a repayment schedule, and charge interest.

• Review compounding, or the ability of interest to build upon itself.

• Once your children begin earning their own money through part-time jobs, introduce them to investments such as stocks and mutual funds.