Right from birth, kids begin to actively pick up skills and knowledge as they engage with different environments. From the social skills they learn at home to the hygiene skills taught at school, all contribute to their development. One lifelong skill that is essential and will see kids through good and bad times is knowing how to manage money.

While some schools do their bit to teach kids financial literacy, it is ultimately a parent or guardian’s responsibility to guide children with the foundational knowledge that is needed to manage finances effectively once grown up. When it comes to money, it’s never too early to start learning.

Ivan Kanyali, Regional Manager East Africa, WorldRemit, has a few tips to help Kenyan parents teach kids how to be money savvy. 

1. Let’s talk money

In many Kenyan homes, parents may not want to chat about family finances in front of their children, but in order to nurture a child who’ll be in good financial shape as an adult, it’s really worth starting the conversation early – without, of course, bringing up any financial worries.

So, consider chatting with the kids from an early age about routine purchases like food, paying for education, transport, and holidays. Discuss the difference between the things you need such as food, water, heating, and the things you want – holidays, technology and clothes or shoes, like the latest trainers.

When they’re young, take them shopping to the local markets, look at the price labels and pay for items with cash, rather than paying with a seemingly ‘magic’ credit or debit card. Cash is a tangible thing – once it’s used, it’s gone. 

2. Introduce them to money

As soon as your child can count, introduce them to money. Show them some Kenyan notes and coins and teach them the value of each one. If their age allows, show them other currencies as well and explain to them in a simple way why different countries have different currencies. Best of all, play some money games with them – engaging games to help them understand the value of coins, how to count money and work out change.

You can play these games online or as board games. Monopoly is an old favorite that not only gets children handling money but also teaches them the basics of investment. You can also create your own homemade games. After all, what child doesn’t love setting up and playing shop? Play and learning really can go hand in hand.

3. Get them budgeting

Whether children earn their own money with an after-school job or get gifts and pocket money from their favorite uncle, it’s worth introducing the idea of budgeting early. And make it fun!

Yes, budgeting can really be fun if you draw up a colorful chart for them to fill in. Two columns: ‘money in’ and ‘money out’.

For younger children, they can learn to put their money in three different piggy banks or jars – money for spending, for sharing/gifting, and for saving. By budgeting, your children will begin to take more personal responsibility for managing their money.

4. Start them saving early

It’s important to teach your children that however much money they may be given or earn – they don’t need to spend it all at once. It is far better to set some goals and save for the future!

Kenyan President William Ruto recently noted that we need to build our savings culture as a country. 

So, help them open a savings account – a digital savings account may be best. After all, our children will be doing most of their banking online in the future. The earlier you get them managing their finances on a computer, tablet, or mobile phone, the better.

Once they have a savings account – you can look at the monthly statements with them – and explain how the account grows because of deposits and interests. Encourage your older children to put larger sums away for something they really want like a new bike or computer.

By saving, your children will learn how rewarding self-discipline and goal setting can be.

5. Working for the things they want

When your child sets their heart on anything from a book to a bike, instead of instantly reaching for your credit card – encourage them to earn the money for themselves. No one wants work interfering with their children’s studies or play, but there are small jobs they can do to earn a little and pay for the things they want.

Young children can top up their piggy banks by doing household chores. Teens (10- to 12-year-olds) can do babysitting, or gardening. And older teens can get part-time work in shops, restaurants, and holiday work in local cafes.

The benefit of this? To give them the responsibility and self-satisfaction of earning their own money and saving from a young age. In this way, they can really understand and begin to appreciate the value of money.

6. Spending, not overspending

Now comes the really fun part. Once your child has saved the right amount, they can go shopping and then spend within a budget. Of course, advise them not to overspend. But as long as they’re mature enough, it’s best to leave the purchase decisions to them. They really need to be in control of their own decisions when it comes to money.

If you help them become smart spenders, you’ll instill in them some valuable lessons about how personal choice relates to managing money.

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