How do your children learn about money?  Some will learn from their friends and what they see on TV, but the most powerful lessons come from the examples set by their parents and other adults around them.

So how do you teach them?

1. Talk about money in front of your children as if it is a natural part of living and not some deep, dark secret. Discuss their saving plan for particular objectives.
   
2. Start small - Set up their own bank account allowing them to use banks, ATMs and debit cards with their pocket money or gift money from relatives. This will give them exposure to managing money and they can also enjoy the "adult" experience of handling money.
   
3. Set limits - Give them enough money to learn important financial principles, but not so much that they think money is unlimited. Let them learn to make choices based on financial limits.
   
4. Give up control - (after setting their limits) Let them make bank deposits and withdrawals, make their own purchases, decide what they want to spend their money on. Offer advice, but let them do it themselves. Let them make mistakes. They will probably spend their money on the wrong things but learn from it.
   
5. Teach them about interest - Help them shop for an interest-bearing account when they start to accumulate some savings – and teach them the value of compounding interest. Even if they have little in the account they will learn from the exercise by watching it grow.
   

In our busy lives, it is easy to say, "I don't have time", but building fun and interesting financial experiences into your children's lives can pay big dividends for them later in life.  Like most things, in the long run, it's worth it.

Sandy Hopps and Strategic Planners Pty Ltd are authorised representatives of Matrix Planning Solutions Limited. 
Sandy can be contacted on 07 4639 4666.