We all want our children to have better lives than we did. As parents, our job is to instill morals and values, build self-esteem, and prepare our kids for life in the real world. In the United States, that means wealth building. Our children can become millionaire if they make the right choices. To prepare them for that, we need to start teaching them now.
Transparency in our personal finances is a good first step. When using a debt paydown calculator, explain what you’re doing. Children should know about debt and how it can affect their future. Imagine if you knew at a young age what you know now. That would have given you a huge head start. Your kids can have that if you do the following:
1. Make Them Work for It
Children need to understand the value of money if they’re going to become financially responsible adults. That starts with making them earn rather than expect you to give them what they need. Rewarding them for mowing the lawn, shoveling snow, or doing cleanup projects teaches them that hard work pays off.
2. Lead by Example
Don’t say one thing and do another. If you preach personal responsibility, hold yourself accountable to those same standards. Admit when you make mistakes and explain what you’re doing to prevent it from happening again. This should apply in all areas, not just finances. Accountability is a behavior pattern that can benefit them throughout their lives.
3. Emphasize the Importance of Education
Getting an undergrad degree and going on to business school is one of the better ways to ensure financial success in life, but that’s not everyone’s path. Instead of planning your child’s journey, emphasize the importance of education and explain how it can benefit them, then let the kids make their own choices. They’ll choose correctly if you do your job right.
4. Teach Them to Communicate
This is particularly important today where so many children live in isolation and spend their time communicating online. Public speaking is an important skill for business owners, managers, and professionals of all kinds. If you want your child to grow up and become successful, make sure they learn how to communicate publicly. Start early so they grow comfortable with it.
5. Put Them in the Right Circles
Hanging out with the poker-playing drunken uncle might be fun occasionally, but that isn’t where you want your children to spend too much time. Enroll them in programs and cultivate hobbies where their peers are upwardly mobile and ambitious. Kids emulate what they see and want to belong. Surround them with the people that will propel them forward.
6. Let Them Earn Their Inheritance
Don’t just give them their inheritance. Make them millionaire it. Dole it out in small portions and give them the opportunity to invest it properly. Help them by explaining how to allocate income, avoid debt, and plan for the future. As they improve those skills, you can always give them more money, if you have it. If not, they can build their own fortune.
The Bottom Line: Start Teaching Them Early The sooner you start teaching your children about money, the more successful they will be in life. Find creative ways to explain simple economic concepts. Be open about debt and the importance of savings. Instill in them a respect for the value of money and make them earn it rather than just giving it to them. Do all this and your children could become millionaire.