5 Holiday financial literacy lessons for your kids

5 Holiday financial literacy lessons for your kids

Published on 26th November, 2020 at 02:45 pm

Just because school holidays are here doesn’t mean the learning stops! Help empower your kids with these fun lessons for financial literacy these holidays.

The importance of teaching financial literacy now

Children are more intuitive about money and behaviour with money than we think they are. In fact, by age three, they’re cognisant of basic money concepts such as spending and saving, and by seven, their lifetime money habits are set. This is why it makes sense to plant seeds of healthy financial behaviour within that early window of their life to set them up for success.

“An important part of preparing children for adulthood is teaching them healthy financial habits so that they can take control of their financial futures,” says Danelle van Heerde, head of advice solutions at SanlamConnect. Tembalethu Lukope, senior financial planner at Heritage Wealth BlueStar, underwritten by Sanlam, echoes this sentiment: “Kids have to learn financial literacy at an early age because budgeting and respect for money are the cornerstone of success in life.”

What’s at risk if these lessons aren’t taught early on? “Not teaching financial literacy about budgeting, borrowing and saving from a young age can put them in a bad situation of not living a meaningful life,” says Lukope. “They need to be taught that irresponsible or excessive borrowing can lead to bad credit, and deny them access to important credit like home loans and other financial needs.”

We asked the experts to suggest their tips for making a game out of financial literacy lessons.

Financial literacy lesson #1: Make saving visual

Nomvula Nkosi, a Sanlam financial planner, encourages parents and guardians to demonstrate the concepts of saving, spending and sharing money, starting with jars. This will help children understand the need to wait before being able to buy something they really want. “Organise three jars for spending, sharing and saving,” she says. “Every time your child receives pocket money or gift money, they should put some of it into each jar.” Here’s how it should be divided to teach a lesson about portioning money according to long-term bigger spends and smaller treats along the way:
Saving jar
“Teach them to put more money into the saving jar, and that this will be for more expensive things they want.”
Spending jar
“This will be for small purchases like chocolates or other small treats.”
Sharing jar
“This money could go to those people who are in need, or your child could donate it to a friend’s cause.”

Financial literacy lesson #2: Go grocery shopping together

“Involve your child in decision-making, where they will learn to save and not just buy for the sake of buying,” says Nkosi. “For example, you can talk about buying a house-brand yoghurt instead of a name-brand yoghurt, and explain that it’s because one is cheaper than the other.” She also suggests, giving your kids some money while you are shopping in a supermarket, allowing them to get a feel for the experience of making choices with money.

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Financial literacy lesson #3: Make gifts

December and January are known as the season of giving, and what better way to build a lesson in money management into your kids’ holiday activities than getting them involved in the gifting process? “Make a list of people to buy gifts for and consider hand-made gifts – this can keep the kids busy and help them to compare the cost of the materials used with buying ready-made gifts,” suggests van Heerde.

Financial literacy lesson #4: Get competitive

What can inspire kids to get good at saving more than a bit of healthy competition? “Suggest the kids compete to see how well they can preserve their pocket money, or how well they spent their money,” suggests Lukope. Otherwise look at Monopoly as a fun way to teach lessons about real life using fake money, and encourage them to be keen to achieve financially.

This savings tool can help you and your family reach your goals.

Financial literacy lesson #5: Help plan activities

You won’t be hearing ‘I’m bored’ these holidays if the kids are involved in planning family activities. Van Heerde suggests getting them to make a list of outings, and asking the family to vote on the suggestions. “The family should consider how much fun it will be (this could differ between family members!), whether everyone in the family can participate, how much will it cost, whether the weather could be an issue, and other factors,” she adds. The takeaway for the kids is deciding what is important to them. “This is essential for making financial and other life decisions,” concludes van Heerde.
Do your kids need help with maths and other school subjects? They can access free expert help using the Dial-A-Teacher benefit for Reality Club, Core, Plus and Health members. Learn more here.   

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