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"Daddy, when can I buy a real car?"
At a Glance
Next time when your young child asks to buy a car for him/herself, don’t brush it off. Take the opportunity to teach your child about financial commitment and needs vs wants.
Try this fun activity to compare our various transportation options, and help your child learn the difference between essentials we need and luxuries we want. This may also help him/her understand the significance of taking on a big financial commitment.
Your 7 - 9 year old
It will take:
Printed ”Compare rides” activity sheet, calculator, pencil & eraser
The important considerations when deciding on a car
An important role the bank plays in our lives
The difference between needs and wants
Discuss with your child why he/she would want to buy a car, instead of taking the bus or the train.
Use the “Compare rides” activity sheet to help him/her work out the pros and cons of owning a car, as compared to other forms of available transport.
Step 1: Purchase
Ask your child to choose a car model then fill in the steps and overall costs of buying it:
Step 2: Ownership
Help your child work out the cost of owning a car. Fill in the monthly costs of:
Step 3: Alternatives
Compare these against the cost of an EzLink card, and his/her average monthly spend on the card.
Don’t forget to also factor in the time saved on traveling (you can use a transit app such as Google Maps or Moovit).
Taking all factors into account, let your child decide whether he/she would still buy a car.
To help your child understand the value of money, you can use values that are relevant to his/her experience.
He/She would understand better what a loan repayment of $700 means if it’s converted into the number of ice creams or toys it can buy.
Save up for a big purchase
|Whether or not your little one buys a car, it is prudent to save up for the future. A POSB My Account is a great way to start! |