Teach your kids how to handle money early on so that later, they don't end up living in your basement!
As a kid, I rarely got allowance from my parents as we had several hardships like job loss and bankruptcy. While my other friends were getting toys and games, I stood on the sidelines thinking they were so lucky. I was determined to change that, and even though my parents were unable to give me much allowance, they helped me get my first job around 12 years old (Yes, I know. I'm the weird kid who wanted a job at 12 years old!)
I became the neighborhood’s newspaper girl.
Every morning I got up early and my parents took turns driving me around the neighborhood delivering papers to all the subscribers. I learned how to handle the money coming in as my customers left me money once a week in an envelope, I sorted through it, and paid for the paper route. Whatever was leftover, I got to keep! It was certainly not easy, and it didn’t matter if it was a holiday or raining outside, the papers needed to get delivered. So needless to say I started to understand what hard-work was. However, from this job, I was able to make my first big purchase with the money I earned. My first TV in my bedroom! It was amazing, thrilling, and a memory I will never forget.
As a parent, I want to teach my daughter the same values that she can persevere and work hard to earn money that will help achieve her goals.
So what are some simple tips to teach your kids how to handle money?
1. Teach your kids to EARN money
Kids will not learn to earn if they are just given allowance. Our job as parents is to teach our kids how to earn money with hard work. Put up a chore list or wheel so they know what they are responsible for and how they can earn money. I also love the idea of putting a dollar amount for each chore so they know you’ll get paid for more for bigger chore items. Just don’t go crazy and try and get your 4 year old to clean the entire house. Know how much responsibility your kids can handle and go from there.
They will feel great if you emphasize that they worked hard for the money!
2. Use the MONEY JAR system
Once your kids have learned to earn money, teach them to sort their earnings across 3 buckets: Saving, Spending, and Giving. Make this a fun activity by decorating each jar with your kids and sorting money together as they earn more go. Also, I like the idea of keeping the jars see through so they can visually see their success grow from week to week.
Spending
This jar will be for immediate spending for when you go the grocery store and they want a special snack or if you go to a carnival/fair they can play games with their hard earned money!
Saving
Now I’m not talking about having them save for retirement or anything crazy but have them think about a larger item to save for (this would have been my childhood TV I saved for earlier). This will help get rid of the “I want it NOW” mentally. For instance, a 7 year old may want to save for a special Lego set that is $50 whereas a 12 year old may want a larger ticket item like $300 Xbox. Whatever it is you help your child identify, teach them along the way by tracking progress so they know how they are doing in achieving their goal. If it’s something they truly desire and can achieve, the memory will stick with them for life that hard-work pays off!
Giving
Last but not least, teach them to put money aside for giving. They can put it in the offering basket at church, give it to a local charity, or even participate in buying a gift for Toys for Tots during the holiday season. Whatever they give towards, make sure it’s their choice as it will be more of a memorable experience.
3. Live by example
Don’t fall into the “do as I say, not as I do” category. Kids watch their parents all the time, so make sure you are being intentional with your actions. Case in point, I want my daughter to learn good eating habits and so I try not to give her too many sweets. However, this mom may want an occasional cookie or two and I’ve tried to have one while she’s not looking but gosh I swear that child can sniff it out. She'll come sprinting saying, OOOhhhhhh ‘that’! I just look at her and think, BUSTED!!!! So, how can you live by example financially?
Don’t keep things a secret- point out teachable moments. You could be on the journey to get out of debt, so create a progress chart so they kids can see that you are working hard toward your goals as well! Or if you attend church and participate in giving, take a break from the automatic online giving payment and start breaking out the checks to drop in the offering basket so your kids see your actions.
You’re not going to be perfect but be consistent. Ha, what parent do you know is perfect? No one. But try your darndest to be consistent on what your teaching our kids about money. If your teaching your kids how to spend their own money, and they blow all their spending money in a matter of minutes, don’t give them more money if they have a temper tantrum. If you stay consistent and say NO, you will begin to teach them they cannot live outside of their means.
TAKE HOME MESSAGE:
Teach your kids how to handle money early on in life. Helping them learn to earn, manage their money well, and lead them by example are just a few things you can do to set your kids up for success.
If your kids can grasp these easy concepts at a young age, they can form strong money habits for life!!
Want to learn more on this topic? Schedule a FREE Discovery Call with me so we can chat and start getting you closer to achieving your financial goals.
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