Kids want what their friends have, and they want it now, or at least sometime soon. So how can parents teach children ‘not to buy’ or at least look for a bargain, wait before buying, and get the best deal, rather than succumb to impulse buying.

How can I prevent my children from impulse buying?

Try these fun rules to help your kids learn how to control their urge to splurge on an impulse buy. Peer pressure can be a strong driver for your kids to purchase the latest game, app or gadget. Learning how ‘not to spend’, or wait a while before committing to purchase, is the key to being able to save for the future.

No regrets - 3 rules for buying

1. The sleep on it rule: Encourage kids to ‘sleep on it’. Put at least one night between what they want to buy and the actual purchase. They may feel differently in the morning.

Ideally, Money Managers suggest waiting 48 hours before committing to a major purchase, but to children this may seem too long to wait, or it may mean losing the opportunity to buy at a reduced price. Encourage the habit of waiting so children learn to control impulse buys.

2. The ‘need’ or ‘want’ rule: Asking ‘Do I really need this?’ before any major purchase is a great question to encourage frugality. Sometimes the honest answer will be ‘No, I don’t really need it, but I want it.’ Help children to recognise the difference.

In economics, the definition of a ‘need’ is something required to survive, such as food, water and shelter. A ‘want’ is simply something that people would like to have.

Help your children work out what is important to them and encourage them to think about the difference between needs and wants, because they can often be confused. Children can easily find a way to justify a ‘want’ by seeing it as a ‘need’.

3. Grandpa’s Rule: Save 10 percent of everything you make. Billionaire investor, Warren Buffett, is quoted as saying, “Do not save what is left after spending; instead spend what is left after saving”. Sounds simple, but it is incredibly powerful, though it requires self-control.

Being frugal is not being cheap. Learning cost-consciousness is a benefit that will help your children manage their money effectively in the future.

What about expensive items?

For big-ticket items, put it in writing

For big-ticket items (such as video game consoles and smart phones) that your kids will inevitably want at some stage, or for the purchase of something you don’t think is good value, try coaching them to create a written proposal.

They can articulate the reasons they want to spend their money, give you explanations, and even include conditions they know will sweeten the deal for you, such as doing extra chores. Once their thoughts are written down, you can apply the 48-hour rule and discuss their proposal. Approved or not, the experience is great practice for the real world!

What else can I do to help my children learn good money management?

ZAAP is a leading-edge digital pocket money tool, which allows kids to have their own Prepaid Mastercard as well as a wearable band that they can ‘Tap and Pay’ with. It’s designed to help Australian parents teach their children financial literacy and money management. ZAAP is supported with a family-friendly app that provides all the digital tools for parents to give pocket money.

ZAAP App gives parents control and kids’ responsibility

Parents enjoy using the ZAAP App because it gives them peace of mind having full visibility of how their children are spending their pocket money. Merchants, such as liquor shops, gambling and dating services are blocked to lessen the risk of anything being purchased that is not approved by parents.

ZAAP is also beneficial for children as it allows them to see their balance, track their spending, and encourage savings. As they can only spend what is in their account, children will:

• Learn how to be financially responsible
• Build good money habits
• Learn the importance of saving money by setting savings goals
• Make secure purchases online or instore through “Tap & Go”

Get ZAAP today!

SPECIAL OFFER: For a limited time only, you can get a FREE pocket money card (RRP $9.95) with over 50 designs to choose from. To take up the free offer, simply create your child account, select your preferred card from the ZAAP range of cards and proceed to checkout. Click here to order today.