Unfortunately, handling money is not something kids learn at school. Since this is an important life skill, rather than leaving them to learn this skill on their own, it is the parent's who should undertake teaching them money management.

While there is no right time to learn about money, it is always advisable to start as early as posible. Here are some tips on how to teach kids the importance of money.

Pocket money - weekly or in return for chores

Decide if you want to give your kids pocket money every week or as a reward for doing chores. Stick to giving money once a week, at least.

If you have difficulties finding chores for young kids, you can ask them to make the bed, help clear the table after dinner, etc. This will also serve to teach kids responsibility and sharing.

Whatever you choose, stick to your schedule.

Emotional chores

If you do choose to give money based on chores, remember to reward kids for things they do for themselves. "Emotional stretches" are a good reason to reward young kids. Give them coins each time they manage to do something that was hard for them. Being nice to a sibling, doing their homework without being told, can be occasions for rewarding. This can serve to promote good behaviour and personal growth in your kids.

Pocket money rules

When you choose to give pocket money as a reward, remember that the rules must be understood by everyone involved. Kids must understand how much you give and for what. If your child can read, make a list of the chores with their matching reward amount. If your child is younger, draw circles to represent the coins they will get for each task.

Money management

Kids must know what falls into the category of what they need to purchase and what comes out of mum and dad's budget. Think about this before you start teaching your kid about money. You must be clear about who pays for their food, for the snacks at school,etc.

Piggy bank

Get your child a box to put their money in. Any piggy bank that does not allow the kids to take the money out is really not effective. Money is not there to keep. It is there to use wisely.

Less is sometimes more

It takes a while for young kids to understand that the value of the money is not measured simply by the number of coins. Therefore, always use the smallest coins to give them money, to give them the feeling they have plenty of money. When they learn the value of each coin, you can start trading single cents with coins of a greater denomination.

Wallet

Get your kid a wallet to take with them whenever you go out. When you go shopping and your kids ask to buy things, refer them to their wallet and explain what they can buy with the money that they have. Teach them how to choose. When they see the money going out of their own wallet, they will not be so enthusiastic about buying.

Loans

If you go with your kids somewhere and they did not bring their wallets, use the opportunity to teach them about lending. Only lend them amounts they can return. If they ask for a loan, make sure they understand what this means. If they are short of money, not giving them the loan, or giving a part is better than simply giving them the money they want.

Savings

Only when kids want something beyond their financial means can you explain why saving money is a good idea. Tell them to put 1 out of every 10 coins in the tiny piggy bank. Saving is also a good lesson in waiting.