Teaching kids about money is the best investment a parent can make. Money is an important part of life and finances can fuel many of life’s luxuries, giving us better control over certain life-predicaments, while also helping to secure our future. We all want our kids to grow up to be financially savvy, but no one is born with money smarts – we have to somehow learn it!
Children learn money habits by watching their parents, so parents can help teach their kids about money by setting positive examples. Having a firm understanding of concepts like how to save, how not over-spend and how to make smart-money work for you, will help kids to eventually take finances into their own hands.
The good news is that it doesn’t take much to put kids on the smart-money path. As is the case with most things, it all starts with communication. From money-based games to raising an earning allowance IQ, there are a number of fun ways to instill the value of a dollar into your children’s lives.
Read on for 8 smart ways to teach the kids about money!
Use The Internet
If your kids are always grabbing your smartphone or tablet, why not offer them a game that combines financial literacy when they do? Many online websites offer interactive money-management games to help kids learn age-appropriate concepts around spending, sharing and saving money.
Cut Coupons Together
When your kids are old enough to participate in a shopping trip, let them help you with collecting coupons. Go through fliers together and let them cut out coupons for you. They’ll have fun being in charge of coupons during the trip to the store. Have them search for the each product to match with a coupon. To make the value of this coupon exercise tangible, give your child the money saved for their piggy bank. This simple act will help instill years of cost-saving best practices in your child.
It’s up to parents to teach kids why it’s a good thing to part with money for those in need. Having children donate a portion of their money earned from allowances from a young age teaches them that they can make a big difference in the lives of others. This sense of empathy will bring much to your child’s life, not to mention the good that comes of it from their financial acts of charity.
DIY Piggy Bank
Buying a piggy bank for your child is great, but it may be more fun if you create a bank together. By working as a team, your child will hone their creativity and you’ll be able to use this financial DIY-time to explain the purpose of a bank and how it’s used. If you’re not that crafty and need help to get your creative juices flowing, check out these fun DIY tutorials.
Pay an Allowance for Chores
A classic approach to teach kids about money is to pay them for work done around the house so they earn a regularly paid allowance. This allowance will motivate children while teaching them about spending priorities and saving habits. Try keeping a chore chart with simple tasks, such as putting away toys or making a bed. If the child does everything on the chart at the end of the week, they earn an allowance.
A good game can make everything more fun, especially learning! So put those old board games like Life and Monopoly to good use and get a weekly game night going. Not only do these games allow kids to develop the skills needed to deal with real life situations like buying a house, paying bills and having a job, but they’re also a great way to spend quality time as a family!
Have a Yard Sale
Kids can learn a lot about finances from a yard sale. AND you get a chance to finally clean out the garage! Let kids sort out clothing and toys they want to sell and help them set prices. On the big day, let them participate and interact with customers. Giving children the final decision about selling used items can teach them an important lesson about value and decision-making.
Set a Good Example
Last, but not least, one of the best ways you can teach good money habits is by letting your child see that you save money too. Put money in a jar while your child is watching and tell them it’s your savings jar. This will show your child that saving is “normal.” Plus, since most young children want to be like their parents, seeing you do it will provide them with an important money lesson that further inspires them to save.