Saving is an important part of living, be it from food, water, things and most of all money for a better supply in the future. A person with financial literacy have a one step ahead compare to anyone. That's the reason why some parents are teaching their children even at a young age on how to save money and give importance to hard work.
Like for example Mrs. Rose Fres Fausto, who's teaching her three
sons on how to deal with their money alongside or while teaching them how to read
and write. In line with the launch of her newest book entitled “The Retelling of The Richest
Man in Babylon,” Fausto shares how she and her husband raised their
children with high “FQ” or financial intelligence quotient.
Here are the 5 Steps in raising your kids with high FQ
1. Start them early. From the moment they were
born, have them open their own savings accounts wherein they can deposit the money they receive. This is a great way for them to have knowledge about saving money on the bank with their names specially when they reach young adulthood.
2. Start small and show
them how to grow their own money. They used easy-to-understand terms and easy-to-follow
steps for their children:
Step
1: Save at least 20% of allowance and cash gifts and keep in a “treasure box”
together
with
a record.
Step
2: Once savings reaches PHP 500, deposit in an ATM account, which is called a
“small
account.”
Step
3: When the amount goes beyond the minimum balance, transfer cash to a “big
account”
or
higher-yielding fixed-income instruments.
The
kids also learned that the “small account “can only give very low interest
because they can withdraw it anytime, while the “big account “yields better
returns since they are giving the bank more time to invest their money. Another
option to grow their money aside from “the big account” is investing in stocks,
which they hold for the long term.
3. Time is money. They showed their children
about the “magic” of compounding: how savings from their weekly allowance can
turn them into teen-age millionaires, if they save religiously. In accumulating
wealth, the biggest factor is time –and time is what the youth have an
abundance of.
4. Make it a habit. It only takes 21 days to
form a habit, especially if one has the will. They taught their sons to be
conscious about their regular expenses or little things they buy, and
prescribed a minimum 20 percent for savings. As their children got into the
habit and earned more, they were also able to save up more.
5. Impart the values. Kids these days are exposed
to a lot of peer pressure which is why it is important to raise children with a
healthy self-esteem. They know they do not have to buy expensive things just to
be “cool” or just to belong. When they go to a store, they do not tell them,
“We’re not buying that because we don’t have the money.” This way, they will know
that it is not only “having” or “not having” money that determines the purchase.
Instead, it is about being in control of their money and not the other way
around.
Rose Fres Fausto is a former investment banker who left her financially fulfilling career to become a full-time homemaker. Now that her sons Martin, Enrique and Anton are all grown up, she devotes her time to her advocacies: purposeful parenting and financial literacy. She is an online newspaper columnist, speaker, and author of the best-selling book, “Raising Pinoy Boys.” In partnership with PSBank, she published a special edition of her new book entitled “The Retelling of The Richest Man in Babylon,” a refreshing take on the 1926 classic by George Clason where the golden personal finance rule ‘Pay Yourself First’ originated. This time, the story is told in a language easy to understand, complete with illustrations and activities for kids from 1 to 92.
Ms.
Fausto also shares that when teaching about money, parents should teach it with
the right values. If what children do with and for money does not agree with
their core values, no amount of money will make them happy as grown-ups.
Moreover, it is about setting a good example as parents. Values are better
caught than taught, and everything they learn in life starts at home.
It
is indeed never too early or too late to start saving, as long as your children
have the will to do what you have planned, and the patience and discipline to
follow through. And to make savings even more exciting and rewarding, parents
can accompany their kids to the nearest PSBank branch to open their PSBank
Kiddie and Teens Savers Account. This not only makes their savings goal
official, but will also help both parents and their children keep better track
of their progress. The PSBank Kiddie and Teens Savers Accounts are for children
0-12 years of age and teens 13-18 years of age. It has no initial deposit or
maintaining balance and the child or teen depositor automatically gets free
personal accident insurance from Charter Ping An Insurance Corporation, with
insurance coverage equivalent to five times the value of his average daily
balance.
This tips and knowledge are very favorable not only for our children but also for the next generations of this country :) .
