How can we Teach the now Generation Good Money Management Skills

Educate the now generation early on about the benefits of saving and investing money. They should know that that picking up efficient money management skills early on helps us become financially independent later in life. Teach them to emulate rich people as they are skilled in saving and investing money, otherwise they would not be rich. Break down a stereotype of a millionaire to them and explain that a millionaire is not somebody with an extravagant lifestyle, luxury car and a mansion. Tell them that it is just a regular guy who takes care of every dollar he earns and has the right relationship with money.

Below are several tips on how to educate the now generation about good money management skills.

1. Communicate with your teenagers timely about the meaning of money and its value

It is important that parents communicate with their teenagers about the meaning of money in their lives. Instill into your children early on the value of every single dollar and how important it is to preserve it and invest it later on. Children should be taught early on to save systematically in order to purchase a car rather than rely on a loan in order to purchase it. Young generation should be taught on time how important it is to delay immediate gratification in order to be able to realize their priorities and long-term financial goals.

2. Explain to them  the value of having a financial plan and goals in life

Once a young person has identified a major financial goal in life like purchasing an apartment, he or she should no longer be susceptible to unnecessary purchases and distractions on the road towards realizing their goals. Tell them that it is always wise to record your spending and reward yourself for small accomplishments on the way.

3. Teach them early on to appreciate the value of saving and giving money

Saving and giving may sound illogical together. However, they are mutually interdependent and are important principles in achieving financial success and independence. Explain to them the concepts of forming three piggy banks which would be saving, giving, and investing and how they best work in combination. You should teach them about the value of advanced planning, budgeting and saving money for their college education.

Teach them to save up cash for purchasing a car. Teach your teenager that he or she should never get a loan for purchasing a car. Instead he or she should save up for it and pay for it with cash if he or she really wants it. A new car looses its value as soon as it comes out of the store.

4. Tell them to stay away from debt

Young generation should be informed that every dollar one earns is instantly diminished in value if you are indebted. Sharing this valuable information with them on time will best protect them from becoming indebted later on in life. As witnessed today debt leaves one vulnerable to short-term marketplace challenges and economic slumps that one would otherwise painlessly withstand.

Young generation should be taught early on to avoid debt and credit cards due to high interest rates that banks are charging and rely on cash instead. It is better to advise children how to find scholarships or save up money for their own education. Otherwise, they will have to rely on borrowing their way through school by relying on debt. Then, once they graduate they will be stuck with enormous amounts of loans to give back while on the other hand nobody can guarantee them a job nowadays. This will leave them financially vulnerable and emotionally depressed throughout their best years of life.

5. Teach your teenager early on about the value of investment

There is no better security for young generation then investing into real estate property. Young people should make it their goal to gradually save their money as they go along in order to be able to purchase an apartment or a house. They will always be able to rent it and earn additional income off of it.

6. Teach your children to become more critical and informed consumers

Teach your children about the media and a culture in which we live which is strongly influenced by the culture of consumerism. Emphasize to them the importance of developing critical thinking skills and learning to differentiate between their wants and their needs. This will help them avoid impulsive spending which can easily get people into debt.