Teaching your kids about money may feel, at times, like a tall order. But it’s an important one.
Research cited by personal finance writer Beth Kobliner in her new book, “Make Your Kid a Money Genius (Even If You’re Not): A Parents’ Guide For Kids 3 to 23,” reveals parents are the biggest influence on a child’s financial behaviour.
What’s more, she writes, is that the lessons kids are taught by age seven will determine their money habits for life.
So what’s the best way to lead them to financial success? According to Kobliner, a mother of three, it’s teaching the concept of delayed gratification.
“I think the No. 1 thing [to teach] is waiting,” she told Business Insider in a recent Facebook Live interview.
“Saving up and waiting for something you want is really the key to money — if you’re able to delay gratification,” she said.
Kobliner says the best way to help kids develop this habit is to put away money for something they really want.
“Instead of buying a snack every day after school, you take that dollar and put it into an account, or even put it into a jar in your living room, and save up that money, and use it to buy a Lego set … designer sneakers, whatever it is,” she said. “That really helps kids get a concrete sense of what they need to do to save money in the long term.”
Kobliner says you can start to practice this concept with your kid when they’re as young as three years old. It doesn’t even have to be about money at first, she writes in her book. Ease into it by talking about the time and patience it takes to wait for a birthday or holiday, or even for their turn on the swing set at the park, Kobliner says.
“Research shows that kids really understand the concepts of exchange and value — so I think ‘waiting’ is really the key,” she said.
Check our full FB Live interview with Beth Kobliner below: