How many times
have you wondered whether your children think money
does indeed grow on trees? It probably seems like every
time you turn around your wallet is being attacked by
the "gimme's". If you honestly examine your spending
habits (and those of your kids), you may realize that
you have not given them any reason believe that you
don't have a money tree.
In truth, we all want things and kids are no different.
How easy it is to whip out the credit card(s) and instantly
gratify our desires. What message are we sending our
kids?
What follows is a collection of ideas about how we can
instill in our children a better understanding of money
and how it works.
Establish a Savings Account and a Plan
Every child should have his own savings account even
if it is just a piggy bank. Whether your child receives
an allowance or works a job, establishing a savings
plan is a must. Encourage your child to donate a certain
amount to charity (to help them develop a lifelong habit
of helping others). Then establish a certain percentage
for long-term savings (such as college) and short-term
savings (such as clothes, toys, etc.).
Saving for both long- and short-term goals will build
a child's confidence in her ability to save and helps
her learn delayed gratification. And, once the savings
goal has been met, she may even discover that the money
would be better spent for something else.
Finally, allot a small percentage for discretionary
spending. You might find that the following percentages
work well: 10% charity, 50% long-term savings, 30% short-term
savings, 10% spending. Find a balance that works well
for you.
Hold a Bill-Paying Night
This is a great activity to show your school-age children
where your money goes. You might even learn a bit yourself.
First, assemble a list of your monthly and/or weekly
expenses and their amounts. The amounts don't have to
be exact. Write the expenses and their amounts on separate
slips of paper. Then, add up your monthly income and
use pretend money (Monopoly® money or make your own)
to represent the amount.
Next, take the expense slips and give them to your children.
Have them come to you and "collect their bill" one expense
at a time. This is an excellent visual representation
of how quickly the paychecks get depleted!
Afterward, discuss ways you can cut your spending to
help stretch the paychecks for things that are really
important. You might be really surprised at your children's
input.
Encourage Them to Work
Even young children can do extra chores around the house
or yard to earn extra money. Teenagers should be encouraged
to get a job. Working helps children understand that
money comes at a cost, thus dispelling the money-tree
notion. Working also improves their self-esteem and
you can teach them to take pride in their work.
Have a Family Savings Fund
Save as a family for large expenses like vacations.
Set up a jar or box for keeping the money in and post
a chart tracking your progress where family members
can be reminded.
Establish Spending Limits
Establish spending limits for items like clothes and
shoes. Be willing to pay so much for something, but
your child must make up the difference with his own
funds if he goes over the allotted amount. For example,
he may want a $100 pair of shoes. You agree to pay what
you normally pay (say $40) and he has to pay the rest.
New school clothes take a huge bite out of the family
budget; why not enlist the aid of your kids? Agree to
only pay for so much and then leave the buying up to
them (within reason, of course). They may surprise you
with what they are able to do with their money. Encourage
them to watch for sales in order to maximize their dollars.
Take Your Child Grocery Shopping
If your child can run a calculator, she can help you
grocery shop. Give her a fixed amount that you will
spend on groceries and have her subtract each item from
the total as you shop. Teach her to compare food labels
and get the best product for the money. Ask for her
input about how you can reduce your overall grocery
bill.
There are many ways to teach your children the value
of money and help them build valuable skills. If you
don't teach them, who will? So take the opportunity
to call a cease-fire in the battle between your kids
and your wallet and work out a compromise in which both
sides win.
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© Simple Joe, Inc.
Chemain Evans is a quality control
specialist for Simple Joe, Inc., makers of the popular
Simple Joe's Expense Tracker PC software. Expense Tracker
is a quick and simple way to keep track of your expenses
and stay within your budget. Expense
Tracker is ideal for tracking personal, business, home
and club expenses.. This article may be freely distributed
as long as the copyright, author's information and an
active link (where possible) are included.
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