As you go further
After the child starts with arithmetic, give him small amounts as pocket money at the beginning. "It should be just enough for him to meet his needs and leave a small surplus, which he should be encouraged to save," says Swapnil Pawar, co-director, Park Financial Advisors, Mumbai. When he is old enough to make his own purchase decisions, suggest that he maintain a ledger of expenses.
At this stage, you can also open a bank account for the child and explain the principles of deposits and interest.
"Tell him that if he puts money in a real bank - as opposed to a piggy bank––the interest on his deposit will buy him something even as the principal remains untouched," says Swami Saran Sharma, Outlook Money consulting editor and father of teenaged kids.
Image: Children cool off in a fountain at Jallianwala Bagh in Amritsar | Photograph: Narinder Nanu/AFP/Getty Images
Also read:
World's 10 most expensive pens
Advertisement
