Preschool time is usually associated with recklessness and the airiness of early age of a lifetime. It’s also a period of life suitable for learning the new concepts and ways the world functions. Without even thinking of concrete concepts such as personal finances and money management, we have learned something by playing with other kids and interacting with adult ones. Here are some things related to personal finances we all had the occasion to learn in our preschool time.
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1.Money is the result of some effort
There are still a shocking number of adults who don’t understand the relation between labour and money due to that labour. That’s the basic thing to grasp when it comes to personal finances. The physical form of the effort you put in some activity, whether physical or mental, is nothing but money. And the things you buy with money earned also represent your labour. At some point, all of us had to clean up the room in exchange for the reward. And that’s the practical exercise of this very lesson about the interconnection between money and labour.
2. Difference between spending and investing
Learning the difference between investing and saving is also part of beginners’ financial education. The excellent example is the difference between buying a toy that will be ditched and put in the corner of a room and the lessons in some practical activity like playing the piano, learning the foreign language etc. The latter is the investment that might help us succeed in many other fields whilst buying things is the pure example of wasting money for nothing.
3. Difference between needs and wants
Making a distinction between needs and desires is essential from an early age. However, it’s the most difficult to do, since children are particularly prone to demand things right here and right now without knowing exactly why they want them. Is it because other kids have it, or because it’s something they saw on TV adds. Most often and especially today when marketers try to turn our desires and needs, it’s crucial to make this difference.
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4. Money allows for more choices
It’s the old saying that money can’t buy you happiness in life. And it’s mostly true, but this calls for the explanation of what happiness is. Of course, everyone has its definition. If it’s possible to have choices in life and avoid the nightmare of doing things you don’t want to do, then money could be beneficial. And here we are not talking only about consumer options, buying things we don’t need and impress people we don’t care about. We talk about life options such as starting a business, moving to another country, and developing your skills and career. Only the most financially literate and disciplined ones can achieve this level of liberty.
5. Planning expenses wisely
Everybody is under temptation to spend the money as soon as it lays on the banking account. However, everyone can learn to handle this impulse from an early age. Most of us got the pocket money from parents or grandparents, which allows us to control the way we spend the money and the way we control our impulses. Having our pocket money allowed us to grasp the importance of controlling the immediate temptation of spending and to see the results of planning the finances wisely.
In Conclusion
In a world of huge competition, fewer resources and instability, wisely planning finances is crucial for a decent life. That’s why every kid should be exposed from preschool age to some sort of financial education. They should absolutely feel and grasp the importance of money management. And that’s one of the best gifts that everyone should be grateful for.
