Go beyond the piggy bank.
Time was when teaching kids about money meant feeding a piggy bank with loose change. But learning about the value money should be fun and memorable. So, instead of just telling them that money doesn’t grow on trees, consider these pointers:
- Encourage them to take in small, odd jobs during summer or the weekends – If the newspaper routes, lawn mowing and carwash gigs are covered, help them think of other innovative ways. A young girl found that a lot of ladies in her neighborhood had tons of broken costume jewelry. She offered to repair, and sometimes upgrade the look for a fee. A young man offered to clean silverware and shine shoes. Jobs teach kids that money needs to be worked for, and hones their entrepreneurial spirit.
- Open a savings account - Piggy banks are cute but they don’t earn interest. A savings account helps you teach your child about how money can grow when they save. Encourage them to save a certain part of their allowance, their income from work, or from monetary gifts.
- Give them a budget to work with for birthday parties – It’s easy to just ask them what they want and whip it out. Go a step further by showing them how much the food, the cake, the favors and the decorations will cost and set a limit on how much you can spend. This will encourage them to plan, spend wisely and think creatively.
- Shop less and pay with cash – Set limits on what they can spend on clothes, books, or toys. Either give them a strict budget or how many items they can buy. Limit the shopping to once a month, giving them enough time to decide what they really, really want. This helps them prioritize their needs and wants. Pay for the items in cash, this way they see what it actually costs and not see the credit card as a magic pay-all card.
- Encourage them to give to charity - If you regularly give to charity or to church, let your children actually see you write that check or drop in the envelope. Tell them where the money goes. This teaches them that wealth is to be shared, it enables people to help others. If they want to give, welcome their donation.
Teaching kids the value of money works only when you practice good money management yourself. Children can see how you spend money and will pick up your habits. [Here are some smart money moves you can do.]
Published in: Family