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Tommy Corbett and Donal Carey of Carey Corbett Financial Solutions, Ennis.

Five valuable financial tips to give to your children

Money management is a crucial skill that every child should learn at an early age. Learning how to manage finances is not just about budgeting and saving, but it’s also about building a healthy relationship with money. As parents, it’s our responsibility to teach our children about money and help them make wise financial decisions in the future. We’re going to set out five valuable lessons that you can give to your children about money.

Teach them the value of money
The first lesson to teach your children about money is the value of it. Help your children understand that money doesn’t grow on trees, and it takes hard work and effort to earn it. Encourage them to save money and avoid unnecessary spending. This will help them develop a sense of responsibility and an understanding of the value of money.

One of the ways to teach your children this valuable lesson is to give them pocket money. This should be age-appropriate and tied to certain responsibilities. This will help your children learn the value of earning money and the importance of fulfilling responsibilities. Encourage your children to save some of this allowance, and to spend the rest on things they need or want.

Show them the importance of budgeting
Budgeting is another crucial skill that your children should learn. Teach them how to create a budget and stick to it. Help them understand the importance of setting financial goals and how budgeting can help them achieve those goals. Encourage your children to keep track of their expenses and income to avoid overspending.
You can teach your children how to budget by involving them in family budget discussions. This will help them understand how much money is available for spending, saving, and investing. You can also involve them in decision-making processes on how to spend the family budget. This will help them develop decision-making skills, financial literacy, and a sense of responsibility.

Teach them the power of compounding
The power of compounding is a crucial lesson to teach your children. Explain to them how interest works and how it can help their money grow over time. Encourage them to start saving early and make regular lodgements to their savings account. Show them how compound interest can work in their favour over the long term. This will help them understand the importance of saving early and regularly.

As Albert Einstein famously said, “Compound interest is the eighth wonder of the world”…

Show them the benefits of delayed gratification
Delayed gratification is a valuable lesson that your children can apply to all aspects of their life. Teach them to save for things they want instead of buying today on impulse. This will help them learn the value of patience, perseverance, and discipline. Help them understand that waiting and working for something can be more satisfying than instant gratification. It also reduces the regret felt after rushed purchases that prove ill thought out.
You can teach your children delayed gratification by setting savings goals. Encourage them to save for something they want and help them come up with a plan to achieve that goal. This will help them develop those all-important virtues of patience, perseverance, and discipline, and it will also give them a sense of accomplishment when they finally achieve their goal.

Teach them the importance of charity
Teaching your children the importance of giving back can help them develop a sense of generosity. Encourage your children to donate a portion of their allowance or earnings to a charity or cause that they care about. This will help them understand the impact of their actions on others and the world around them.
One way to teach your children about giving back is to involve them in volunteering activities. This will help them understand the importance of helping others and making a positive impact in the world, through their own actions. It will also help them develop empathy and a sense of responsibility towards their community.
In conclusion, teaching your children about money is an essential life skill that can benefit them for all of their lives. It’s never too early to start this journey with them.

Carey Corbett Financial Solutions are Independent Financial Brokers specialising in pensions, mortgages, investments and retirement planning and can be contacted on 065-6893540

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