Financial Literacy for Kids - A Complete Guide
Whatever your child’s academic and career pursuits, outside the classroom it’s a level playing field when it comes to money matters. As a parent, money management is one of the most important life skills you can teach your children.
Kids observe how we spend and save. It is important for parents to lead by example and try to inculcate sound money habits in your children so they can grow into smart and responsible adults.
If you do not have a savings account with HDFC Bank then you will need to open one, before you open a Kid's Advantage account. Apply for HDFC Bank Savings Account.
Here are five ways to get them started:
- Introduce them to currency
Tangible and durable currency in the form of coinage is the easiest way to introduce young children to money. Let them watch and learn how to safely transact with paper money. Help them get comfortable with handling currency by solving basic mathematical problems with coins and notes.
As they grow older, introduce them to digital currency through kid-friendly platforms such as HDFC Bank Kids Advantage Account, where they can transact via net banking, UPI and debit cards.
Read more on how to plan your child’s future with the HDFC Bank Kids Advantage Account.
- Impart the virtue of patience
We all know the joy of breaking a piggy bank, spending ages counting and recounting the money within, and contemplating how to spend the windfall. Let your kids experience the same joy while they learn the virtue of patience. Incentivise them to save for longer by promising to match their savings with an equal contribution from your end.
You could build a corpus towards your child’s future by issuing standing instructions for a monthly transfer from your account to your little one’s Kids Advantage Account.
- Teach them the value of money
In this age of social media, it is really important for children to understand the value of things and not just their cost price. Let them earn their allowance by doing chores around the house such as taking out the trash, setting the table, watering plants, etc.
Teenagers can make extra pocket money by helping the elderly, giving tuitions, or taking up a summer job. They can learn real-world skills while productively using their free time. Their earnings can be deposited in a Kids Advantage Account, wherein amounts in excess of Rs 25,000 automatically sweep in term deposits through the ‘MoneyMaximizer’ facility.
- Lead by example – shop smart
Take your children with you when shopping for groceries and other essentials. Help them understand the basics of comparison shopping to get the best value for money. The same practice can be followed online, by looking for discounts and value-based deals through e-commerce portals such as HDFC Bank SmartBuy.
Incentivise your children by passing on a certain percentage of savings to them, and they will proactively keep an eye out for bargains – and maybe even willingly accompany you.
- Giving is important too
Making money is important, but it is equally important to share it with one’s community and aid those less privileged than ourselves. Helping people who are less fortunate builds empathy and a sense of compassion.
Let your children find a cause close to their heart and contribute accordingly. They could make a donation towards the education of an underprivileged kid, or if they love animals, spend some time to care for them and contribute towards their welfare.
The earlier you start, the more likely your children will grow up to be mindful about investing and prudent about spending money. These money management lessons will, however, need to progress gradually, based on their age and maturity level.
HDFC Bank Kids Advantage Account is precisely the kind of partner you need to build a strong foundation of financial literacy that will ensure your children have a bright future.
Looking to open an HDFC Bank Kids Advantage Savings Account ? Click here to get started.
* The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances.