As a responsible parent, it is important to teach your kids about the wonders and pitfalls of money management. But if you are in financial trouble yourself, how do you teach your kids anything that will have meaning for them? Remember, just because you are having temporary financial troubles, does not mean that you don’t know what needs to be done. Teaching them will also remind you of the best ways to handle money issues. Here are some ideas to help:
It’s The Little Things. When kids get into the first grade, they are introduced to coins. They are taught their amounts, how to count coins, and what combinations of coins equal a dollar. Addition and subtraction are also studied, and the beginnings of multiplication and division are explored. But learning these things doesn’t actually help them UNDERSTAND money, and its uses. You can help. By giving them “play money”, and talking to them each time you take them to the grocery or other store about how to decide which items they want and how much money they have to spend on those items, sets the pace. Just like in every-day life for us grownups, they will have to put things back and make good decisions. Be prepared for some tears and upsets, but it is all done in the spirit of learning. Encourage the kids to use their play money at home playing “store” as well.
Allowances. A weekly allowance, especially for doing chores, is a great way to get kids into the spirit of budgeting and saving. An allowance of $5.00 per week, as an example, for doing a series of chores to help out around the house provides a rich medium for kids to learn that there is “no free lunch” in life. No matter what “chores” you give them to do, it is important to keep a chart of their progress, and give out “stars” for completing tasks…read more here