What are you teaching your kids about money? Well before they start school, children develop attitudes that can inﬂuence a lifetime of financial behavior. Parents can inﬂuence even very young children for a lifetime by demonstrating sound money management. In addition, talking to your children about money can help them build a sense of financial awareness and ﬁnancial responsibility. Here are some ways you can teach your kids about money.
1. Play games that teach money concepts.
Board games such as Monopoly and Life can be a fun way for children to learn about money. An added bonus: the whole family can play together.
2. Take your child shopping.
Going to the grocery store can be very educational if you take the time to turn it into a learning activity. Tell your child what your budget is, share what is on your list, and talk about the decisions you make in order to stay within your budget. Explain how coupons can help you save money.
3. Give an allowance.
School-age children can earn an allowance by helping out with chores. Earning an allowance gives children hands-on experience with managing their money.
4. Encourage saving.
There are different kinds of saving: saving in order to buy a particular item, saving for an emergency, and saving to build up future ﬁnancial security. Try to teach your children to designate a portion of their money to different types of saving.
5. Teach generosity.
Have a discussion about charity and encourage your child to pledge a portion of his or her allowance to the charity of their choice.
6. Open an account.
Go with your child to your local credit union and open up an account. Explain that the money in the account will grow because of interest paid by the credit union. (Find one without a monthly account fee that can quickly eat up any attempts to save.)
7. Use cash.
Whenever possible, pay with cash to demonstrate the physical exchange of money for goods and services. The prevalence of paying with plastic can be confusing for younger children. Take time to explain how the credit union and ATM card work.
8. Set a good example.
How you handle money will have an impact on your children’s money management skills. Don’t spend more than you earn, create a budget and stick to it, keep credit card debt in check, and save for the future.