Most parents will worry about their children’s future finances and future happiness. Recently, we’ve been discussing how to set up your children for a successful, happy life and how to prepare their future financially. At Etax Accountants, we have a lot of team members who are new parents. We’ve found some interesting research about parenting and ways you can influence your children’s success and happiness. Below are some ideas we’ve collected about setting up your children for a great future, touching on how to help build your children’s “money sense” and personal happiness.
1. Get your kids busy at home
Recent research shows that chores at home are a critical part of raising well balanced, happy grown-ups.
Professor Marty Rossmann, a family education research expert, has studied young adults and their family lives when growing up. Taking a group of people who’ve now entered their 20’s, her study examined parenting styles, gender, types of household tasks, time spent on tasks, and attitudes. She also studied the same young people’s stability and ‘success’ based on items like completion of education, starting a career path, IQ and positive relationships with family and friends.
What’s the #1 predictor of kids becoming successful, well-adjusted adults?
Professor Rossman’s answer is surprisingly simple: Chores. Kids who started doing family chores at age 3 to 4 are more likely to be successful and happy when they reach their 20’s.
Another surprising result of her study: Kids who didn’t start doing chores until age 15 or 16 actually did worse later on.1
Of course, keeping kids active doing chores, especially throughout their childhood development, can be easier said than done. Here are a few sites that talk about that challenge:
- Kidspot’s 6 ways to get kids to do housework
- Empowering Parents on How to get kids to do chores
- The Centre for Parenting Education on The benefits of kids doing chores
2. Piggy bank basics teach kids about money
Young people who learn about earning and saving money early-on have huge advantages in life – because for them, the things they want come easier.
One of the best ways to improve your children’s financial future is to “plant the seeds” for simple attitudes and behaviours that will help them later on. Part of that can involve the way we help them to think about saving: Is saving a negative sacrifice, or a positive accomplishment?
Here are some good websites on teaching your kids about money.
- From ASIC – the MoneySmart website
- From the Commonwealth Bank – Teaching your kids about money
- Radio National ‘Life Matters’ radio program (and podcast) about Kids and Cash
- Lifehacker on Teaching Today’s Kids About Money
3. A bit of smart saving to help improve your children’s financial future
It is amazing how just a little bit of saving, starting when each child is born, can provide an education advantage for your children. If you can save $100/month, by the time your kids are at university-age, you’ll be able to give them a real boost. If you can save more than that – you might be able to pay for a university degree.
For young people getting started in their careers, education costs can really slow-down their independence and success. And the Government is making education more expensive for young people. What will it cost in another eighteen years?!
Saving for your kids’ education helps erase those worries. When you start saving, there are a lot of options and some possible tax breaks as well.
- Choice.com.au has an interesting guide to saving for your children’s education (an older link but still useful)
- If you look on Google for “education savings plans” you’ll find additional information
- Info about claiming interest on kids’ accounts from the ATO
Do your homework carefully before you get started – but here’s the most important thing: Just do it! Getting started is the hard part – but once the savings habit is started, most people don’t even notice the difference. However, if you put off education savings for a year, the final amount is much lower. Even if you can only afford a little bit to start with – get started!
One easy way is to set up an automatic transaction, maybe from the account where you get paid to a “don’t touch” education savings account. Saving money sight-unseen can be easier to live with because you get used to it quickly. But remember – if you start to earn more money and you’re comfortable, then increase the weekly or monthly savings amount.
If you spot any interesting ideas about helping your kids get a good start on life, connect with us by email (firstname.lastname@example.org) or share with us on Facebook. And thanks for any suggested links to good content about helping kids become happy and prosperous!
1 The University of Minnesota has more details about this research. ABC News (US) on Raising Responsible Children.