Christmas Day is here again and also time to play Santa as well as give gifts to your children and the loved ones. After all, it's the season when families come together to share gifts and spend their valuable time with the people they love.
Christmas Day is here again and also time to play Santa as well as give gifts to your children and the loved ones. After all, it’s the season when families come together to share gifts and spend their valuable time with the people they love. Christmas is a special day for kids because they associate this occasion with gifts which, as most of them believe, are presented by Santa Claus himself. However, while there is no harm in giving gifts to your kids on occasions like this, at the same time it is also necessary to keep teaching them some money lessons so that they could learn the value of money and just don’t start believing that money grows on trees. It is also important to remember that only good financial habits will help your kids become a rich man going ahead. So, here are some financial gifts and money lessons which you should try to give to your kids on this Christmas Day:
1. Money does not grow on trees: You must have heard that kids’ minds are just like blank slates. So, they learn whatever is taught to them or whatever they see. They unconsciously not only pick up your gestures, but your financial traits too. Therefore, if you give them the impression that money can be earned without making any effort and, therefore, should be wasted without giving any thought to it, then you are not only making the worst financial mistake of your life, but are also trying to ruin the financial future of your kids! So, first of all you must teach your children from the day they start going to school that money never grows on trees!
2. Saving is important: There is no need to overemphasize the importance of saving in one’s life. Someone has rightly said that “it is not about how much money you make, but it’s how you save it.” Just take a look at the billionaires of the world like Warren Buffett. It is their habit of saving and investing which has made them what they are today. And also look at the Rajahs and Maharajahs of yesteryears. Their descendants are leading the life of common people because they never believed in saving money for their future generations. No need to mention that the more you save, the more wealth you will be able to accumulate and the more wealthy you will become. Therefore, teach your kids the importance of saving money. Better, buy them a piggy bank and tell them to save money from their pocket money. At the end of every month, check the amount saved by them and put the same amount from your side as a reward. This will induce them to save more and also inculcate the habit of saving in them. You can teach the same thing to your spouse also.
3. Teach kids to spend smartly: Teaching your kids only about saving money is not enough. They also need to be taught the art of spending money smartly, when needed. Therefore, show your child how they can make the most of their money by spending that in a way that adds the most value to their life. For this, your can give them small tasks like buying the best pen or colour pencils in the given amount. Or, you can take them with you while shopping on a weekly or monthly basis and teach them how to buy grocery and other household items by making the most of money. This will help them learn how to spend money smartly.
4. Involve your children in making family budgets: Having taught your kids the importance of saving money, you should try to involve them in making your family budgets. This will help them understand how much their parents earn, how much money is needed each month for household and other expenses, and how much needs to be saved for securing the financial future of the family. Thus, apart from learning the art of budget making and cutting their coat according to their cloth, the kids will also appreciate the fact why their parents need more time to buy a luxury car for the family or an iPhone for them.
5. Invest for your kids’ higher education and marriage: Higher education has become very expensive today. Therefore, start investing in a suitable investment avenue to meet the expenses of your child’s higher education and marriage. If you have a girl child, then you can even invest in government schemes like the Sukanya Samriddhi Yojana, which is a small deposit scheme meant to meet the education and marriage expenses of a girl child. An account can be opened up to age 10 only from the date of birth of a child. Normal premature closure is allowed after completion of 18 years provided that the girl gets married. You can invest up to Rs 150,000 per annum in this plan for 15 years and the account matures after 21 years from the date of its opening.