When is the best time to teach kids about money?


Posted at Apr 09 2012 05:24 PM | Updated as of Apr 10 2012 01:30 AM

MANILA, Philippines – Teaching kids about money may be tricky – you have to introduce them to the basic principles without making them materialistic.

But it’s not as hard as it seems, said personal finance advocate Salve Duplito, since it is natural for children to ask the question: “Where do Mom and Dad get their money?”

And this is the first thing that parents need to answer.

“The more they know where or how their parents get their money, the more they become careful with their toys, for example,” Duplito said on ANC.

“They will clean their house because they know their house is paid for by the hard work of their parents.”

Duplito said parents can teach their children about counting change or sorting coin denominations as early as age five, but stressed that the main factor to consider is the child’s “individuality.”

They can then give their kids a weekly allowance by the time they attend elementary school so they would learn how to create and maintain a budget.

“Like P150 in a week, make them set aside 10% and they can use the rest,” she said.

Value of money

More important than the saving tips and the math skills, however, is guiding children about the value of money, Duplito said.

She stressed that most people tend to place too much importance on money to the point that children grow up being greedy and materialistic.

“Society breaks down when everybody is just after the money, the car, the house, the big clothes, and the nice shoes. You want to teach them that it’s not bad to work hard so that you can earn the money. But where you spend that money is important, how you prepare for your future is important,” she explained.

Duplito said parents should constantly remind their children that money should not only be used for their own interests, but also for the benefit of the community.

On top of these, parents should also set a good example to their kids, she added.

“Money should only be a way to get to that point,” she said. “In the end, it’s about honesty, leadership and community service.”