Monday <strong>26</strong> <strong>Mar</strong>ch <strong>2018</strong> <strong>26</strong> BUSINESS DAY This is M NEY A daily guide to your Personal Finance • Savings • Travel • Debt & Borrowing • Utilities • Managing your Tax Are your children financially literate? tional about introducing this important subject to children from their earliest years. It is heartwarming to see the efforts being made by the Central Bank of Nigeria (CBN), the Nigerian Stock Exchange (NSE) as well a financial literacy steering committee including stakeholders in the capital markets, banking, insurance, and pensions industries in Nigeria, to drive for financial literacy among our youth. When should money lessons start? Parents have a primary role to play in encouraging financial literacy among their children as the most practical and profound lessons are taught at home. To raise money- Global Money Week (GMW) was celebrated last week. It is a Child & Youth annual financial awareness campaign built to inspire children and young people to learn about money matters, livelihoods and entrepreneurship.’ “It is more important than ever for children and youth to be economically equipped and empowered to close inequality gaps and build a brighter future. Money Matters is important because children and youth need to receive the knowledge and develop skills to make smart financial decisions throughout life.” Our current educational system focuses almost entirely on academic subjects and very rarely is any aspect of money management taught in the school curriculum. Children thus leave school and university and step out into the world with little or no knowledge about how to manage money. Yet money matters impact every aspect of our lives. Until financial literacy is integrated into the Nigerian school curriculum to better equip students to manage their finances in adulthood, the responsibility largely falls on parents, grandparents, guardians, teachers and other stakeholders to be intensavvy children, start to teach your children from their earliest years and certainly from when they can count. Thereafter, regularly reinforce money lessons as they grow. Teach them the difference between wants and needs. Discuss with them where money is going and what your priorities are. They should also make their budget and prioritize between their wants, and needs. Sometimes it is difficult to explain things but practical exposure to paying utility and other bills can become powerful learning events. These will be long lasting lessons in how they manage their own money. Involve children in the family finances When it comes to earning, saving, spending and giving, try to involve your children as you plan your basic household budget. Take young children to the supermarket with you. Let them watch the process of selecting various items and how much they cost. Allow them to make some choices to learn what is expensive as compared to what is more affordable. Play board games Board games are a powerful tool for learning. The Monopoly Board Game and Cash Flow for Kids are engaging educational games that teach the basic concepts of money management through play. Turn this learning opportunity into quality face-toface family time, building long lasting relationships and learning at the same time. Should children be given an allowance? An allowance puts money in your childrens hands and presents an opportunity to introduce budgeting and prioritizing. Opinions vary as to whether or not they should be given an allowance. Some argue that it gives them unrealistic expectations and develops in them a sense of entitlement to be given money for doing nothing. When your children earn or are given an allowance, help them to divide it into four tiers: saving, investing, spending, and giving. By guiding them through these concepts, you are laying a foundation for their future financial security. Should you pay for chores? Some parents go as far as to introduce commission based work for chores. Certain tasks at home are thus assigned amounts and if the job is done very well, they are paid. If they don’t do the job well or display a bad attitude or are unhelpful, Good money habits, learning early in life can help to insulate children from making hard mistakes later in life payment is withheld. One wonders if the payment for chores wont make children tie monetary compensation to everything that they do. There should be roles and responsibilities in every home without monetary compensation. Learning to earn Children should learn the virtues of work from a young age. However, do ensure that the jobs that they do are age appropriate. Even the youngest children can do minor tasks that keep them engaged and provide useful learning opportunities. How are your children spending the Easter holidays? A holiday period presents one of the best opportunities to put some financial principles their way. Our children tend to imitate our money habits. They see you working hard so why not put them to work for at least part of the holiday. Of course they must get the required rest to prepare for an important term but vacation jobs provide valuable lessons that hard work of how money should be earned. There is also the added benefit that their work experience needs. As children get older, they are introduced to debit and credit cards. Indeed, as soon as they arrive at some university campuses, they become the target of financial institutions, some of who are keen to introduce debt very early in their banking relationships. They must be taught the pros and cons of both. If your children become prone to debt from an early age you can be certain that you will be spending much of your retirement years bailing them out of staggering financial difficulties. We all know how much better off we might have been if we had learned the basics of personal finance when we were much younger. Good money habits, learning early in life can help to insulate children from making hard mistakes later in life. This is your chance to give your children a head start by introducing some of the basic money principles to them now. They will be so much better for it. Financial knowledge is a gift that will be given throughout their lives. Instagram and Twitter: @ mmwithnimi, Facebook and Google+: ‘Money Matters with Nimi’. www. moneymatterswithnimi. com, or send us an email info@ moneymatterswithnimi. com Nimi Akinkugbe has extensive experience in private wealth management. She seeks to empower people regarding their finances and offers frank, practical insights to create a greater awareness and understanding of personal finance. For more personal finance tips, contact Nimi: Email: info@ moneymatterswithnimi Website: www. moneymatterswithnimi. com Twitter: @MMWITHNIMI Instagram: @ MMWITHNIMI Facebook: MoneyMatterswithNimi
Monday <strong>26</strong> <strong>Mar</strong>ch <strong>2018</strong> C002D5556 BUSINESS DAY 27