From our archive. This article was published on 30 June 2021. Rules and amounts may have changed since.
“Smart Money Smart Kids” is a book written by Dave Ramsey and his daughter Rachel Cruze, which sets out to teach parents how to instil financial skills in their children. The book contains practical tips and strategies to help children understand money, save and invest wisely.
Some key principles and insights from the book are:
Give children financial responsibility: The book recommends giving children financial responsibility from a young age. Let children earn their own money, draw up their own budget and make their own decisions about how they want to spend their money.
Teach children to save: The book stresses the importance of saving and encourages teaching children to save for the things they want, instead of seeking instant gratification. Also teach children how to set savings goals and how to manage their savings.
Teach children about debt: The book discusses the importance of avoiding debt and teaching children about the risks of credit cards, loans and other forms of debt. Teach children how to avoid debt and how to manage their money wisely in order to achieve financial freedom.
Teach children about investing: The book encourages teaching children about investing and the importance of building a solid financial future. Teach children about the different types of investment and how they can make their money grow by investing.
Set financial goals: The book stresses the importance of setting financial goals and drawing up a plan to achieve them. Teach children how to set financial goals and how to manage their budget to achieve those goals.
Lead by example: The book stresses the importance of being a good example to children when it comes to managing money. Parents must handle money wisely themselves and teach their children how to make sound financial decisions.
Communicate about money: The book stresses the importance of communicating about money within the family. Talk openly with children about money, teach them the value of money and teach them how to use their money to achieve their goals.
By applying these principles, parents can help their children develop healthy financial habits and equip them with the skills they need to build a solid financial future.
Would you like to talk to someone? Then get in touch with us.