by Heather, September 17, 2013
Money does not grow on trees. As a parent, it’s your responsibility to teach your children where money does come from. Even little kids, as young as 3 years old, should learn the basic facts about how to earn and spend those greenbacks and shiny coins. Here are a few ways you can start teaching kids how to save money and give them good money smarts so your kids can be money savvy as they grow older.
The Monthly Bills
Let your children see what your monthly budget looks like. Show them how much money you have earned and a list of things you need to pay for every month. Write out a check for each amount and deduct it from the budget. Food, clothing, shelter, and power take up a large sum of that money. Go over the basics for living and how much they cost, and teach kid to prioritize and maintain a financial plan. An important thing to include on your budget is savings. Good lessons in dividing up the money and budgeting will help kids realize that you work hard to make the money so the family is taken care of. Visual aids for the younger kids can help.
Start with basic money games. Play Monopoly with older kids and go online to find fun money related games for younger kids. For little kids, play supermarket. Price foods and see if they have enough money to buy stuff. Teach them to plan out how they will spend their money and account for every purchase. Go to the real stores and involve your kids in the shopping. Learning how to shop can be fun.Teach them how to price compare, look for better deals, and to use coupons. Let them purchase things for themselves and help your kids learn the value of every coin and bill.
Allowance & Jobs
Introducing an allowance for chores or good behavior is also a great way to help kids understand the importance of earning and saving money. Stress that the purpose of an allowance is to learn about money, and also the value of hard work. Find age appropriate jobs or household tasks each child can strive to complete. Give them a chart, a goal, and a reasonable amount of time to achieve the tasks.
A teenager who can get a job out in the world has the perfect opportunity to save money from their very own paycheck. Every kid wants to have spending money but they should get into the habit of paying themselves first. They should have their own check and savings account too to watch the savings build up.
The best way to help kids save money is to open a savings account in their name. Not just any savings account, but a good one that will earn interest. Offer to match the deposits that they make. Explain that the reason for a savings account is to be better prepared for the future. Save for a rainy day, a vacation, or a college fund. The sooner they begin saving, the better off they will be when they’re on their own.
Teaching kids how to save money is not complicated, but it does take a bit of continual practice. But the results will be worth it for you and the kids.