Financial skills
What is Finance?
Finance is all about how we manage our money. It’s like being the boss of your own money! Let’s break it down into parts that are easy to understand:
Earning Money: This is how you get money. You might earn money by doing chores at home, like cleaning your room or helping in the garden. Some people earn money by working at a job.
Saving Money: Once you have some money, you don’t have to spend it all at once. You can keep some of it in a safe place, like a piggy bank or a savings account at a bank. This is saving! It’s like planting a seed and watching it grow over time. If you save a little bit of your money regularly, soon you’ll have a lot more than you started with.
Spending Money: Spending is when you use your money to buy things you need or want. It’s important to think before you spend. Ask yourself: Do I really need this? Could I use my money for something better?
Budgeting: This is a plan for how to spend and save your money. Imagine you have $10. You might decide to save $4, spend $3 on a toy, and $3 on a snack. That’s budgeting – deciding in advance how to use your money.
Giving: Sometimes, we use our money to help others. This could be donating to a charity or buying a gift for a friend. When you give, you’re sharing what you have to make others happy.
Borrowing and Lending: Sometimes, you might borrow money from someone, like when a friend buys you a snack because you forgot your lunch money. You should always try to pay it back. Lending is when you let someone else borrow your money. It’s important to only lend money to people you trust.
So, finance is really about making smart choices with your money, whether it’s saving, spending, or sharing. Think of it like a game where the goal is to be smart with your money and use it in the best way possible. And just like in any game, the more you practice, the better you get!
Why is is it important to understand how Finance/Money works?
Understanding how finance and money work is super important for several reasons, especially as you grow up. Let’s look at why it’s such a big deal:
Making Smart Choices: Knowing about money helps you make smart choices. For example, if you understand how to save and budget your money, you can buy things you really want or need without running out of money. It’s like learning the rules of a game, so you can play it better!
Preparing for the Future: Money isn’t just for buying things now; it’s also for the future. If you start saving money early, like in a piggy bank or a savings account, you’ll have money for important things later, like college, a car, or even your own house!
Avoiding Trouble: Understanding money helps you stay out of trouble. If you don’t know how to manage money, you might spend too much and not have enough left for important things, like food or school supplies. It’s like eating all your candy at once and then having none left for later.
Being Independent: When you know how to handle money, you can be more independent. You can make your own decisions about what to buy, how much to save, and how to use your money in the best way. It’s a bit like learning to tie your own shoes – it feels great to do it yourself!
Helping Others: Understanding money also means you can help others. You might decide to give some of your money to people who need it or support good causes. It’s a way of showing kindness and making a difference in the world.
Feeling Confident: Knowing about money makes you feel confident and responsible. You won’t have to always rely on others to make money decisions for you. It’s like being the captain of your own ship!
Planning and Goal Setting: When you understand money, you can set goals and plan how to reach them. Maybe you want to save up for a new bike or a video game. By managing your money wisely, you can achieve these goals.
So, understanding how finance and money work is a big part of growing up. It helps you make smart decisions, plan for your future, and feel confident and independent!
How can you earn money and fill your pockets?
Jobs at home
Step 1: Talk to Your Parents
- Ask for a Meeting: Tell your parents you’d like to talk about doing extra jobs at home to earn some money.
- Discuss Ideas: Share your thoughts about what jobs you can do. These might include cleaning your room, helping with dishes, or taking care of a pet.
Step 2: Make a Job List
- Write Down Jobs: With your parents, make a list of jobs you can do around the house.
- Be Clear on Details: Make sure you understand each job. For example, if the job is to clean your room, ask what exactly that includes, like making your bed or putting toys away.
Step 3: Set Up a Payment Plan
- Talk About Money: Discuss with your parents how much you will earn for each job. It might be a small amount like 50p or £1 per job.
- Keep a Record: You can make a chart to keep track of the jobs you do and the money you earn.
Step 4: Do the Jobs
- Start Working: Begin doing the jobs you agreed to do. Try your best to do them well.
- Be Consistent: Do your jobs regularly. If it’s a daily job like feeding a pet, make sure you do it every day.
Step 5: Collect Your Earnings
- Payment Time: After you complete your jobs, collect your earnings from your parents.
- Save or Spend Wisely: Decide what you want to do with your money. You can save it, spend it on something special, or even donate some.
Step 6: Review and Adjust
- Talk About Progress: After a while, talk with your parents about how things are going. Are the jobs working out? Do you need to make changes?
- Set New Goals: Maybe you can take on more jobs or save up for something big!
Remember, doing jobs at home to earn money is not just about the money. It’s also about learning responsibility, developing good work habits, and understanding the value of effort.
Jobs for neighbours & family
Step 1: Talk to Your Parents
- Get Permission: Before you start, talk to your parents. It’s important they know and agree with what you’re planning.
- Discuss Safety: Make sure you and your parents agree on which neighbours or family members you can work for. Safety first!
Step 2: Choose Your Jobs
- Think of Job Ideas: Consider what jobs you can do. This might be raking leaves, shoveling snow, helping in the garden, or washing cars.
- Match Your Skills: Choose jobs that you know how to do or can learn easily. If you love being outdoors, garden work could be perfect!
Step 3: Talk to Neighbours or Family
- Offer Your Services: With your parents’ help, talk to your neighbours or family members. Let them know what jobs you can do and that you’re looking to earn some money.
- Be Polite and Clear: Explain what you can do, how much you charge, and when you’re available.
Step 4: Set a Fair Price
- Discuss Payment: Talk with your parents about how much to charge for each job. It should be a fair price for the work you’re doing.
- Keep it Reasonable: Don’t overcharge. Remember, you’re learning and gaining experience.
Step 5: Do the Job Well
- Work Hard: When someone hires you, do your best. Show up on time and do the job as well as you can.
- Ask for Feedback: After you finish, ask if they’re happy with your work. This can help you learn and improve.
Step 6: Collect Your Earnings
- Get Paid: Once the job is done, it’s time to get paid. Say thank you when you receive your money.
- Manage Your Money: Decide what you want to do with your earnings. Save some, spend a little, and maybe even share some.
Step 7: Build Your Reputation
- Be Reliable: If you do a good job, your neighbours or family might ask you to work again or recommend you to others.
- Stay Organised: Keep track of your jobs and schedule so you’re always on time and prepared.
Remember, doing jobs for neighbors or family is a great way to earn money and learn new skills. It’s also a great way to show you’re responsible and trustworthy.
Selling hand made crafts and goods
Step 1: Discover Your Craft
- Find Your Talent: Think about what you’re good at making. It could be anything from painting, making jewelry, baking cookies, to creating friendship bracelets.
- Practice Makes Perfect: Spend time perfecting your craft. The better your creations, the more people will like them.
Step 2: Make a Plan
- Decide What to Sell: Choose a few items that you can make well and enjoy creating.
- Set Goals: Think about how many items you want to sell and set a goal. This will help you stay focused.
Step 3: Gather Materials
- Collect Supplies: Make a list of what you need to make your crafts or goods. This could be beads, paper, paint, or baking ingredients.
- Budget Wisely: Talk to your parents about buying supplies. Remember, the cost of materials should fit into how much you plan to earn.
Step 4: Create Your Products
- Start Crafting: Begin making your items. Make sure each one is something you’re proud of!
- Quality Counts: Take your time to make each item special. The better they look, the more likely they are to sell.
Step 5: Set Up Your Shop
- Decide Where to Sell: You can sell your items to family and friends, at a local craft fair, or maybe even set up a small stand in your neighborhood (with your parents’ permission).
- Price It Right: Set fair prices for your items. Not too high, not too low. It should cover the cost of your materials and your time.
Step 6: Market Your Crafts
- Tell Everyone: Let people know about what you’re selling. You can make flyers, or ask your parents to help spread the word online.
- Be Creative: Show off your products in a fun and attractive way. Presentation can really make a difference.
Step 7: Sell and Learn
- Enjoy Selling: Have fun meeting people and talking about your crafts.
- Learn From Experience: Pay attention to what people like and what they buy. This can help you decide what to make in the future.
Step 8: Manage Your Earnings
- Keep Track of Sales: Write down how much you sell and earn.
- Decide on Spending: Think about saving some of your earnings, and maybe even reinvesting in more materials.
Selling handmade crafts and goods is not only a great way to earn money, but it’s also a wonderful way to express your creativity and learn about running a small business. It’s exciting to see people enjoy what you’ve made, and it feels great to earn your own money from your hard work and talent!
What should you do with the Money you have earned?
Saving for the future
When you earn money, one of the smartest things you can do is save some of it for the future. Here’s why and how:
Set a Savings Goal: Think about something big you might want later on, like a new bicycle, a video game console, or even starting a car fund. Having a goal makes saving more exciting!
Start a Piggy Bank or Savings Account: You can keep your savings in a piggy bank at home or, with your parents’ help, open a savings account at a bank. This keeps your money safe and separate from the money you might use every day.
Regular Savings: Try to save a little bit of the money you earn regularly. Even if it’s just a small amount, it adds up over time. It’s like adding pieces to a puzzle – bit by bit, the bigger picture comes together.
Watch Your Savings Grow: The cool thing about saving is seeing your money grow. Over time, you’ll have more than what you started with, which gets you closer to your goal.
Be Patient: Saving takes time. You won’t be able to buy something big right away, but if you’re patient and keep adding to your savings, you’ll get there. It’s a bit like waiting for a plant to grow – it needs time and care.
By saving for the future, you’re not just keeping your money safe; you’re also learning how to plan ahead and be responsible.
Spending Wisely
Once you’ve earned some money, it’s tempting to spend it right away. But spending wisely is a key part of managing your money well. Here’s how to do it:
Needs vs. Wants: Understand the difference between things you need (like school supplies) and things you want (like a new toy or game). Always take care of your needs first.
Make a Shopping List: Before you go to the store, make a list of what you plan to buy. This helps you remember what you need and stops you from buying things on impulse (that means buying things you didn’t plan to buy just because they look cool).
Compare Prices: Sometimes, the same thing can cost more at one store than another. Look around to see where you can get the best deal. Maybe check out sales or use coupons if you have them.
Quality Over Quantity: It’s often better to buy one thing that’s good quality and will last a long time, rather than lots of cheaper things that might break easily.
Think Before You Buy: Before you buy something, ask yourself: Do I really need this? Will I still want it tomorrow or next week? Sometimes, waiting a day before you buy something can help you decide if it’s really worth it.
Treat Yourself Responsibly: It’s okay to buy something special for yourself once in a while, as long as you have enough money for the things you need. This is your reward for being smart with your money.
By spending wisely, you’re learning to make good choices with your money. It helps you get the most out of what you earn and teaches you valuable skills for the future. Remember, every time you spend money, you’re making a choice, so make it a smart one!
Sharing and giving back
Earning money is not just about saving or buying things for yourself; it’s also about sharing and giving back to others. Here’s why it’s important and how you can do it:
Why Share?: Sharing makes you feel good and helps others. When you give, you’re showing kindness and making a positive difference in someone else’s life. It’s like sharing your toys with friends; it makes both of you happy.
Donating to Charity: You can give some of your money to charities or causes you care about. It could be helping animals, supporting a school, or giving to a food bank. Even a small amount can make a big difference.
Gifts for Family and Friends: Sometimes, it’s nice to buy a gift for someone special, like a birthday present for a friend or a thank-you gift for a family member. It shows that you’re thinking of them.
Helping in Your Community: Look for ways to help in your community. Maybe there’s a local project or event that needs support. Your contribution, no matter how small, can help make things better.
Teaching Responsibility and Gratitude: When you share or give back, you learn about responsibility and gratitude. You understand that not everyone has the same things and that you have the power to help others.
Set a Giving Goal: Decide how much of your money you want to share or donate. It doesn’t have to be a lot. What matters is the act of giving and the thought behind it.
By sharing and giving back, you’re not just helping others; you’re also growing as a person. You learn about empathy, kindness, and the joy of making a positive impact. Remember, when you give a little, you get back a lot in happiness and love.
The building blocks to develop Finance/Money skills
Understanding Value
Budgeting & Planning
Saving Regularly
