My younger sister can’t save money for anything. If she gets $20, she goes out and gets her nails done, without any idea of how she will pay for the upkeep. Watching her has made me realize that I need to teach my children about money. Here are some tips for making sure that your kids understand the money basics.
Give your children an allowance that is age appropriate. My kids get half of their age for their allowance. On their birthday, their rate is raised. We give them chores during the summer and expect them to help out when needed during the school year. Set some rules for earning the allowance, as well as the amount of money that your children will earn.
Once they’re earning some money, teach them about saving it. Many banks offer savings accounts for children. Help them decide how much money they want to spend and how much they want to put away. Make them a chart that keeps track of their money so that they can watch it grow.
Let them spend some of it and be silly. Part of the fun of having money is spending it. I had a friend who would not allow her child to spend any of his money. He had over $100 in the bank but couldn’t use it. Letting your kids spend their money teaches them the value of things and how to use money wisely. Make sure your kids only spend what they have. Don’t loan money against the allowance that they will receive. Kids need to learn that most employers don’t just hand over paycheck advances in the real world.
Teaching your kids about money will provide them with a valuable tool for when they’re older and get their first job. Instill in them a healthy relationship with spending and saving money and they will grow up to be fiscally responsible adults.