Family Finances: Tips for Teaching Kids While They’re Young

boy holding dollars fanned out

If you’ve ever been in a bad situation with money, you’ve probably wished that someone would have provided you with a more solid financial basis. Since your children are still young, you have the opportunity to do that for them. These are some tips that will help you to teach kids about the importance of maintaining strong finances throughout their lives.

Clue Them In

Depending upon the age of your children, you might want to start teaching them some terms that relate to finance, and educate them on what the consequences of poor financial management can be. You may wish to teach them how to count money and what a savings account is, and explain how the state of both can affect an entire family. Together, examine the role that each family member plays in helping the family budget.

Give Them an Allowance

Some parents give their children money whenever they want it, but you should teach your children that this is not how life will be. Instead, allocate an allowance, perhaps based on how old they are, and distribute the money to them on a weekly or bi-weekly basis. Explain that this is all of the money they will have until their next “paycheck”.

Save for Something Together

You can also teach your children how to save money in order to reach a big goal. Perhaps your son wants to purchase a new bicycle. Explain the total cost of the item, and make a plan for buying it together. For each $10 that he earns shoveling snow, you could match it, or give him a few dollars more. Providing a reward helps kids to see the benefits of money and savings.

Learning Math

When children are unable to understand the concepts behind finances, they often have trouble figuring out what exactly being financially savvy means. Page through your children’s math textbooks to see if they are dealing with any related concepts, or how you could tie the lessons into your own educational sessions about personal and family finances. Helping your children to understand math can be crucial in this endeavor.

Create a Budget Together

According to Abakhan & Associates Inc., involving your children in the household finances is a great way to teach them about money. You can work on creating a budget together, and you can help them learn how to budget their own needs. Take them to a bank or British Columbia bankruptcy clinic and have them ask questions about money. When your children are old enough, you may want to make them responsible for paying part of the budget.

When your children are still young, you have the perfect opportunity to teach the about money through these strategies and give them a step up in adult life and finances.

Earnest Parenting: help for parents who want to teach their kids to be financially savvy.

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