4 Ways to Teach Your Kids About Money
It's never too late to start.
April is Credit Union Youth Month and we’re applauding our young member savers. Now's a good time to strengthen the financial habits of our youth by focusing on the values of saving and budgeting money. As a child, a piggy bank is handy for saving your loose change and allowance. But it can hardly teach the importance of budgeting money. Where does the money come from and, more importantly, where does it all go? Here are a few exercises you can do with your children to show the concepts and importance of responsible budgeting.
- Make the budget real. Take the next paycheck and cash it out in $1, $5, $10 and $20 bills – or get the equivalent in play money. Sit down together and place the pile of bills on the table. Write out index cards for each bill the family pays from that paycheck (i.e., utilities, house payment, groceries, school activities, piano lessons, cable, car payment, insurance premiums, savings, charitable donations). Place the cards on the table and put the amount of money needed for each bill on each card. Then, show them what is left! It’s a very visual lesson on how important a budget is for paying bills responsibly.
- Create a chore chart with money earned for each chore. This can be done with a simple poster with a list of chores and how much each one is worth. Each child signs the chart for each chore they complete, and they are “paid” at the end of the week. You can also help each child to pick out their own cleaning supplies at the store, making it their special project.
- Set a family goal to collect left over change in a jar. It’s amazing how quickly everyone’s loose change adds up! Put a jar on the counter in the kitchen and everyone empties their loose change into it every night. It’s a good way to save up for a family entertainment night out, or spending money for an upcoming vacation.
- Put the kids in charge of the week’s meals. Help them devise a weekly dinner menu, then assist them at the store as they use the food budget to buy the necessary ingredients to prepare the meals for the week.
Start helping your children acquire healthy financial habits when they are young. And as they grow older, it will become easier to talk to them about money matters with a foundation of positive communication through family activities related to financial wellness.