This blog post is all about spending. No, not how to spend (I think we’ve all got an idea about how to do that), how to spend responsibly. Here are 3 steps that you can take to help your children refrain from impulse purchases and turn themselves into sensible spenders.
Step 1. Give them responsibility
The level of responsibility will obviously vary depending on the age of your son or daughter. With younger children between the ages of 8 and 12 years, this can be as simple as encouraging them to make their own transactions. When they want to buy a magazine with their pocket money, let them work out which one they can afford and complete the transaction in the shop themselves.
As your children get a bit older, it might be good to give them responsibility for some spending that isn’t just what they want. At 12 to 16 years, you might want to hand over a monthly allowance and give them the responsibility of paying for lunches and bus fare themselves. This way they learn to budget as well as teaching them the sad truth; spending isn’t always something that’s fun.
Step 2. Don’t interfere too much
Though it may be hard, you need to allow your child to develop a sense of responsibility and independence. Telling them what to spend and where to spend it might not be as helpful as it feels. Take a step back and let them make mistakes, because that really is the best way for them to learn.
Step 3. Encourage discussion around choices
Making choices and learning to prioritize is important. With younger children, a good way to start is to help them understand that they can’t just have both. Help them consider which option is best by asking them questions like ‘which do you need more?’ and ‘how often will you use or wear that?’
As kids get older, these exercises can become more complex. Try involving them in discussions around a large purchase such as a new dishwasher. Get them to do their research into different priced machines, and discuss the different things you consider when looking at these purchases.
Getting into these good habits around making choices, will help them a lot when it comes to moving away from home or being given their first instalment of a student loan.