What do your kids know about money? Anything? If you want to start teaching your kids about money, here are some simple, kid-friendly financial suggestions you can put to use, from how to save to how to spend smart.
Appreciation: Taking Care of What’s Yours
Sharing a room can teach a lot of lessons, such as how to get along with brothers or sisters and sharing. It also teaches your kids how to take care of what’s theirs. From cleaning up together to taking care of their toys, your kids will learn to see the value in their things. If your kids have bunk beds, teach them to take care of their own area and be responsible. Plus, the sibling who doesn’t take good care of his or her area, pastes stickers on the headboard and brings snacks into bed will quickly find out that not taking care of things is a big no-no.
Money Matters: Earning Allowances
Chores are a great way to teach responsibility to children of all ages. Chores show your kids the value of hard work and that it pays off in the end. Giving your kids an allowance lets them learn smart money habits early on. Chore charts are a great way to get younger children excited about doing things around the house and making a little money. However, as your kids get older, chore charts aren’t the best tool. Encourage your older kids to find problems around the house or the yard — a pile of leaves outside or a basket full of laundry, for example — and have them negotiate their payment for completing the chore. That way earning money can be creative and fun rather than just what someone tells you to do.
Saving: Opening That First Bank Account
Taking a trip to the bank and opening up a bank account for your children can give them an idea of what the bank does. A bank account also gives your kids a good place to stash their birthday money or allowance. A new bank account is best for elementary-age kids and teens; however, there is no age restriction. Moms and dads typically have joint ownership in the account when it comes to kid-banking, so rest assured that you’ll have financial control. Look for a bank that offers no minimum balance or monthly maintenance fees, a good interest rate, in-person and online access, and perks like an ATM card. After the bank account is established, be sure to make frequent visits to make deposits or use the ATM card.
Buying: Toys Don’t Grow on Trees
One of the biggest and most traumatic experiences of money management is the realization that money doesn’t grow on trees and toys aren’t free. For kids, this is often hard to fully grasp. To teach your kids about buying things, like toys that they can’t live without, have them make their own purchases and spend their own money. Whether it comes from their piggy bank, allowance or bank account, making your children purchase items they want can make them appreciate the value of a dollar. If your child doesn’t have enough for that new toy, don’t give in. Instead, encourage your child to save up for next time.