Basic money management is rarely taught in school. And few parents discuss money with their kids at home. That only leaves millions of children at a disadvantage. Many children come to adulthood without even a cursory knowledge of personal finance. Consequently, adults tend to learn money management by trial and especially, by error.

Kids who do learn about money early will be way ahead in the game. Just as important, learning to deal with money properly helps foster discipline, good work habits and self-respect.

Here are seven ways you can help your child get a good handle on money management:

Start With An Allowance

An allowance can be a vital tool in teaching kids how to budget, save and make their own decisions. So instead of giving your children money whenever you like, give them a fixed amount at regular intervals. Children remember and learn from their mistakes, when their own money is lost or spent foolishly.

I personally believe that an allowance should not be tied directly to a child's daily chores. Kids should help around the house not because they get paid for it, but because they share responsibilities as members of a family.

Let Children Work Part-Time

Work can boost a child's confidence and teach her the dignity of labour. As children grow older and their employment options expand, they see that they are becoming literally more valuable in their contribution to society. But don't let kids overdo it. Because of the academic pressures they face at school, kids should work only during their vacations.

Teach Them To Save

That, of course, is easier said than done, since kids can be notoriously instant pleasure seekers. You have to provide good reasons for them to save. You might start by limiting the number of special things you give your children, such as fancy bicycles or expensive clothes. Explain that if they want something of greater value in the future, they will have to forgo things of lesser value in the present. Children can start savings accounts in nationalised banks with as little as Rs 100. Point out to your kids that in addition to being safe in an account, their savings will earn interest. In the end, the saving habit will make kids better appreciate what they've worked hard to acquire.