Teaching our kids about money is an important part of parenting; it’s also one of the toughest. As our kids grow, they start to find material objects more desirable, and feel as though they need to get their little hands on anything and everything that catches their eye. Ever accidentally take your kid(s) down the toy aisle at Walmart or Target? If you said YES, you definitely know what I mean!!
So, how exactly do we start teaching our little one(s) about money? Today, we are offering a little help. Check out our 6 tips to teach your kids to value money!
Teach them the importance of earning
Growing up, we did not receive an allowance. Fortunately or unfortunately, my parents didn’t have the financial means that allowed that. However, if there was something that we really, really wanted, there were times that we were able to do chores or work that allowed us to EARN they money that would pay for our want.
The first step to teaching kids the value of money and to help them develop smart financial habits is to teach them how to earn. Start by rewarding your kids for a job well done, or when they help you out with chores at home, or even assign them specific tasks for the weekend. Teach them how money isn’t free for anyone, and that it needs to be earned.
Introduce a budget
Once your kids start earning pocket money, it’s time to introduce them to the importance of budgeting. Give them tangible examples of how budgeting has helped you. Maybe budgeting has led to financial success or perhaps freedom? Explain to your kids and show them how setting aside a specific amount of money for expenses can help them from overspending.
Budgeting has been HUGE for the success of our family. At one point in time, we were over sixty thousand dollars in debt. After following a program that focuses on budgeting and taking control of our finances, we paid off the debt and learned better habits that have allowed us to live a life where money isn’t as big of a stressor.
Teach them to wait
Do you remember your parents saying, “Good things come to those who wait?” I have found that this is normally true; especially when it comes to money. Impulse purchases have gotten me in trouble on more than one occasion. I’ve ended up with an item that I didn’t want, need, or like AND since it wasn’t a planned purchased, I’ve often had to pay more for the purchase because I wasn’t being smart with my money.
Is there a certain item that your little one has had their eye on? Is it rather expensive? Encourage him/her to save up a little money every week, money earned by doing chores, and inspire them to save up to buy the toy on their own. By saving up and buying the item with their own money, this will not only teach your son or daughter to value money but also the purchase, too!
Set an example
Kids are like little sponges! They are always watching, always listening, and they absorb everything that we do and say and model their behaviors based on ours. My daughter is eight and easily my “biggest fan.” She mimics how I talk and how I behave. Are your little ones the same?
This sponge-like behavior and the knowledge that we are raising children to be adults is one of the reasons why it is so important to lead by example. Do you spend your money wisely? Do you budget? Are you a spender? Chances are good that your little one is watching what you do with your money and will start developing habits just like yours. We are our children’s first teachers!
We are raising adults of tomorrow and it is important to teach them the importance of maintaining sensible spending habits, avoiding impulse purchases, and the value of a dollar. These are automatic lessons that our children are learning without knowing it. Leading by example, a positive example is literally the easiest and best way to teach our children. My goal is to raise a strong young woman that is money savvy, is that your goal for your children?
Teach them giving
Does your family give back or donate? Giving doesn’t always mean providing material things.
As I mentioned above, growing up, we struggled a great deal financially. My parents were both extremely hard workers BUT there was a time when my dad got hurt, was out of work for a year, and my mom had to “carry the load” on her own. Financially stable or not, I always, ALWAYS remember our family giving. We would donate what we could, work at the soap kitchen, and were active in the community giving back.
No matter how much pocket money your child has or has earned, it’s imperative that we teach our kids the importance of giving. An easy way to do this is to encourage your child to select a local church or community organization where they can help. Hmmm, sounds like a great family project that will allow you all to spend quality time together while giving back! By donating, be it time, money, or goods, your children will realize the true value of what they own. This will also teach them the importance of sharing and giving at an early stage in life!
Saving is cool … REALLY!
This one is HUGE for us. Saving really is cool because it lends itself to successful behaviors. We save up for large purchases, vacations, and even family outings. We are teaching our daughter to value money and experiences and, for us, savings is a part of that.
Help, encourage, and carve the path towards financial success and intelligent spending by teaching your children the importance of saving money. Show to them why they don’t need to spend every dime that they have and how savings can lead to great experiences. Explain to them why it is important to save up for a “rainy day” or an unexpected emergency.
Do you have a piggy bank in your little one’s room? They can be picked up for as cheap as a dollar at a local store and will allow your child to start saving now! The clink, clink sound is fun to them and music to a parent’s ears. Why not start today?
Hopefully these six tips will prove helpful for your children and perhaps even you. Money and savings can be really scary but they don’t have to be. Take baby steps, take your time, and spread knowledge while raising savvy savers!
Do you have a tip about how to teach children to save money? Please share them in the comments below. We could all use any help that we can get!