Children need to understand money

MONEY NEEDS TO BE UNDERSTOOD

It is very easy in this day and age, for children to grow up without appreciating and understanding what money is all about. With transactions conducted on line, by card and through email, hard currency is being consigned to history.

Money, once concrete and easy to see, feel and use is fast becoming illusionary. No longer is currency the main item in wallets and purses. This makes it hard to share an understanding of money with children.

Teachers may conduct some activities in classrooms to offer familiarisation with hard currency. However, the exercise can be almost meaningless. Children rarely see their parents and other adults dealing in hard currency, so the concept of visible money is disappearing.

It is easy for children to grow up without understanding the value of money. It is also easy for them to grow up without understanding the meaning of debt and credit. Recent studies confirm that many people have no idea about debt and how easily it accumulates. In order to avoid growing up with a similar lack of understanding, children need to understand money.

Recent application

An application has recently been developed that may assist children to better understand the meaning and value of money. The application ‘Easy Money’ is free to download from the online Applications Store. It is user friendly and provides children with the chance to consider and understand financial issues. Saving, spending and investment are included.

The application offers scenarios posed as questions. The proposition about savings illustrates:

“How much have you saved right now?

How much will you save every month?

What percent interest do you expect to earn?

How long until you need to use the money?”

A pop-up calculator allows the user to insert data into boxes next to each question. When completed, the answer is revealed. It shows the amount banked, interest earned and total savings.

Some of the topics include:

What can I afford to buy?

How long to repay a credit card?

What is my loan repayment?

How long will it take me to save up?

How much do I need to retire?

What is the return on my investment?

‘Easy Money’ can be used by parents at home and teachers at school to help children understand and appreciate money. And it will be beneficial to them in reinforcing sound principles of money value and management.

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