One of the greatest advantages every parent can give to their child to succeed in life is financial literacy.
In today's complex financial world, it's increasingly important to equip children with the knowledge and skills to manage money effectively. Financial literacy—the ability to understand and use financial concepts like saving, investing, and budgeting—has become a vital life skill that can shape a child's future well-being. By teaching children about money from a young age, parents can empower them to make informed financial decisions that will benefit them throughout their live
Any parent can benefit from these “How to?” to raise responsible adults:
How to teach them about Earning?
Surprisingly, but even children as young as three-year-old are able to start learning this concept. Imagine you are on a family all-inclusive vacation. Ask your little one to bring you something from the buffet. Give them some coins as a payment for the “service”. “Voila!” – they earned their first money.
Older kids can take part-time jobs and earn their own income. Encourage them to start developing a skill they are interested in like vlogging, crafting, catering assistant, etc. This will give them basic knowledge about the entrepreneurship and money management. We can help with our exclusive “Salary account for kids”.
Seeing their name engraved on the debit card will make them feel important.
Plus, they're likely to spend less because they'll feel more accountable.
How to teach them about Savings?
As your child learns about earning money, they will realise the value of different things in life. Now would be a good time to bring the piggy bank home for your kid to slide in the coins. Or use this opportunity to open a bank account for them. There is no age limit for opening a kid account at Raiffeisen Bank Albania.
This could be your joint parent&kid account for new video game or kid’s room decoration where they can make a tangible contribution. When parents involve their kids in grown-up topics, the kids will realize:
"The world takes me seriously and my opinion does matters."
How to teach them to spend wisely?
It's not necessary that your child needs to be wise every time they spend their money. They may have been saving up for a new pair of trendy sneakers, which are very expensive. That may not seem as ‘smart’ financial decision but allow your child to make it and learn from it. Ask them to research what else they could have done with the same amount of money – go on a stadium tour of their favourite football team, or go to the cinema with friends multiple times, and why not even the amount of food they could have bought for their pet or themselves.
As a parent, educate them about the differences between needs vs wants. If they choose to spend too much on something expensive and not really needed, which results in them not having money for the rest of the week, they need to learn how to deal with it.
How to teach them about Budgeting?
Make financial lessons relatable by incorporating real-life scenarios. For an example, if your child receives an allowance, you can help them create a simple budget that includes savings and spendings.
You can also involve them in discussions about family expenses, such as grocery shopping list or vacation planning, to show them how financial decisions are made.
How to teach them about Banking?
Do you remember your experience of going to a bank for a first time? Whom should you speak to? What documents do you need? How do you fill that form? All these questions can be harrowing if you do not have prior experience. That's why you should start early when it comes to banking and its services. You can start by visiting the bank together with your kid - go to the branch for deposits and withdrawals from the kid account. Include them when you need to fill forms or let them do it under your guidance. It will make them feel confident and important.
Teach Them by example. Children learn best through observation, so it’s important for parents to model good financial habits. Show your kids how you save, budget, and spend wisely. Share your financial decisions with them, explain the reasoning behind. This is not only teaching valuable lessons but also normalizes conversation about money, which is a key to building financial confidence.
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