We would all like our children to appreciate the value of things – whether it’s the value of money or the value of love.
The truth, says René Roux, head of Sanlam Liquid, is that a lesson about making and preserving money can easily be forgotten, but a lesson about wealth may well last a lifetime.
“As parents our daily lives present us with numerous opportunities to teach children about money and wealth. Shopping presents a lesson about budgeting, an ATM presents a lesson about saving, and presenting a homeless person with a loaf of bread presents a lesson about sharing and true wealth.”
The key, says Roux, is to be tuned to events that enable us as parents to meet our obligations to teach our children about saving for the future, just as we are tuned to teach them that positive results depend as much on our commitment, motivation and hard work as it does on the manner in which we perceive the world.
“Even parents who ‘get it right’ in relation to their own savings sometimes struggle with messages about the value of money when it comes to their children. Leading by example is obviously key, and this includes ensuring your children experience the benefits of saving as much as they experience the benefits associated with giving to others.”
Early lessons about the value of money, she says, may focus on a range of activities – from regular savings into a child’s first piggy bank, to regularly depositing the proceeds from a piggy bank into a savings account, to budgeting with pocket money, working towards specific savings goals and making donations to favourite charities.
She says if and when you decide to guide your children through the maze of savings accounts, teach them about interest while instilling in them an awareness of the cost of things.
Pocket money earned for doing small tasks around the house is always a better idea than pocket money that is simply provided, as earning one’s own money presents children with the opportunity to learn that hard work accompanies earning money. And, when the money is earned, an opportunity is created to learn about budgeting. After all, it’s easy to ask for something, but it’s something quite different if the decision to save up for it and to make sacrifices in the process is all yours!
“Again, the trick is to involve children. Let them take their own piggy banks to the teller while you offer guidance. Allow children to choose items for which they wish to save – and allow them to experience the time required to save up the full amount. Visit a few charities – from animal welfare organisations to care facilities for children – and allow your children to experience first-hand what it is to which they will be donating.”
Roux notes: “Someone once said that a wise man should have money in his head, but not in his heart. I’d say: Make sure you invest in both these areas if you want your children to experience true wealth.”