Money is something that we all need to get through this capitalist society that we live in, and we need to make sure that we teach our kids how to use it. Teaching your kids the importance and value of money at an early age makes them grow into more responsible adults. So, without further ado, let’s dive into this blog and learn some simple ways to teach your kids the value of money.
1. Use a transparent piggy bank
If you’re using the classic “piggy bank”, consider using a clear piggy bank so you can see what’s inside. Seeing the change accumulate is an excellent way to illustrate saving, and the reverse is just as good to show what happens when you spend. It’s an easy way for kids to realize that money doesn’t fall from the sky. Since the tooth fairy won’t always be there to deposit a dollar under their pillow magically, it’s essential to let them see the dynamics of saving and spending with their own eyes.
2. Let them earn their allowance
I know, it’s so tempting to give them weekly allowances, so they don’t bother you for $5 at any time. However, remember that having them earn it is a valuable learning experience. In addition to teaching your kids that their parents need to earn their money too, it also has great side effects: work ethic and time management!
Why not have your kids do some basic tasks to earn their weekly allowance? Take out the trash, help in the kitchen, clean their room… If your child wants to play video games all morning and play soccer with friends in the afternoon, that’s their choice. Taking time to do chores comes with a cost, like less video game time. It also has to come with a reward, which in this case is a weekly allowance.
3. Take them to the grocery store with you
To combine business with pleasure, take your kids with you and let them understand what’s going on during your grocery shopping. What you put in the basket, the choices you make, why you make them, etc. It’s a fun, enjoyable routine that opens up a ton of learning opportunities.
It’s a real-life example of managing a budget, with real-time decisions between different choices. It’s also an excellent opportunity to show the differences between “I need” and “I want”, two categories of expenses that need to be kept separate when managing your budget. As a bonus, you can even teach your kids a thing or two about healthy eating by planning meals with them.
4. Open a bank account for them
You can easily (and legally, of course) open a bank account for your child and even order their own debit card. It may seem unnecessary, but it’s a great way to teach your little ones the basics of budgeting.
Every year for the summer road trip, my mom would deposit a set amount into my bank account, which became my little budget for our vacation. Instead of always asking her for money for unnecessary things, she would simply tell me how much I had left and how much I wanted. Then I had to make the decision myself, and I paid with my card at the end.
5. Teach them to give
Giving is always a nice gesture, and generosity is a great value to teach our children. Whether it’s a donation to a charity, participation in a fundraiser, or even a donation to support a busker, make sure your kids know what’s going on. Depending on the context, you can even give them the money and let them make the donation!
They’ll get the smile and “thank you” that comes with it and learn how rewarding it is to give in the process. Keep this in mind the next time you make a donation, and let your kids be part of the process!
6. Give yourself an introduction to saving
When planning your vacation, get your kids involved and ask them what they want to do. Why not make the activity they want to do so badly a “financial” goal? Get them in the habit of saving money for future projects.
Of course, this also comes with the joy of spoiling themselves when the time comes. Even if it’s only for a month or a few weeks, the goal is to give their young minds the first experience with the “I’m not spending now to get what I really want later” principle. This is an important learning experience that will serve them well later in their teenage years and adult lives.
Sound off in the comments section below and tell us what you want to read next and if you want to read more about money.