MAKING YOUR CHILD A MILLIOAIRE AT AGE 21
Remember that the easiest way children learn how to make money is through observation of the way their parents handle money and the experience they have as a result of spending money in a particular way.
Setting goals is fundamental to learning the value of money and saving. You should introduce the child to the value of saving versus spending, making him realize that the more he saves the more interest he has and the more he spends the closes he is to debt and poverty, most especially if it is not buying value for money. You can do this to him by showing him two glass and label one S and the other I showing S for saving and I for interest
Therefore if you pour the savings glass half way, pour a little in interest as a result of saving, and there by you will have taught the child the power of compound interest by the time you finish with the two glass cup. Let your child set his or her goal within reason. This will give him some incentive to save. Encourage your child to divide up his or her money to save part of it and spend part of it and use part of it for charity. Young children may loss interest in goals that take longer than a week or two to reach. If your child fails to reach his goal, chalk it up to experience. Over time, your child will learn to become a more disciplined saver.
Keeping good records of money saved is another key factor to teach the child. This you can do by getting 12 envelops for the child; tell him to keep the receipts of all purchases each month in at least one separate envelop and keep good notes on what he does with his money. Yes need to show your child how to spend money by comparing items based on their prices and quality. For instance when you go for shopping you may tell him to go and check the price of two different brands and explain to him why you prefer to buy one to the other.
If you have more than one child, tailor money management lessons to them individually. Don’t put children against each other in financial competition. Treat each child separately. Children are constantly tempted to spend money but aren’t born with the ability to spend it wisely. Your can set aside one day per month to take your child for shopping. This will encourage your child to save up for something him or her really than buying something on impulse. Research shows that your child’s best chance of becoming a millionaire is through owning his or her business and buying it to success.
Do you know you can determine weather your child will be struggling for money at age 21 or will be in control of money? A new born baby has nothing but time and that should be exploited to the fullest to make the child a millionaire. You can by following these basic skills and a history of using management is better prepared to tackle financial issue that will have critical impact on his or her adult life. A person’s financial life according to Godfrey is divided into stages: apprenticeship (5-18), starting out (19-30), taking charge (31-50), looking (51-65), and third wave (66).
In the first stage when parents still hold the greatest influence children should develop financial vocabulary, establish early financial habits and practice savings, earnings and giving. Teaching kids about money can be done as simple as telling a kid to turn off the light in rooms you are not using. The lesson happens on the spot when children ask why the light needed to be turned off. A parent who responds by explaining that electricity cost money teaches the consequences of leaving lights on. You can tell your child to come and call you when its time for stock news.
It’s ok to give children a financial reward for doing certain tasks that require them to be responsible because that is the way the world works. Kid need to be taught that money can be used to accomplish something else other than buying goods or entertainments for one.