Teaching kids about money is one of life’s hardest things to do. You really don’t want them to grow up and make the same mistakes as you. The best thing you can do is teach your kids real lessons about money. Lessons that they won’t forget anytime soon. Here are some real-life tips for teaching kids about money. Not only do you want to find freedom from debt for yourself, but you want to teach your children about setting up their own future for financial freedom and success.
7 Real Life Tips for Teaching Kids About Money
- Let your kids earn money: The best real life tip for teaching kids about money is to let them earn their own money. If you buy everything for them, they’ll never understand what money is and how it works. In the real world, your child works and then they get paid. They don’t get paid for doing nothing. Make them responsible for their own money. If they aren’t old enough to have their own job, give them a small weekly or monthly allowance. Make them be responsible for paying for something each month on their own from that allowance. Things like their school lunches, school supplies or a new book can all be a part of what they learn to budget for.
- Talk to them about money: So many families treat money like a taboo subject. Money doesn’t have to be taboo and it’s something you can really talk to your children about. There are certain things you should talk to your kids about at a young age and money is one of those things.
- Let them see you spending money: Kids will never understand how money works if they don’t see you spending money. Let them see you hand over cash when you’re paying for items. Kids won’t understand a debit card and how it works unless you plan on teaching them how to balance a checkbook at the age of seven. Hey, I’ve heard of crazier things. 🙂 Show them how to make good financial decisions by making them yourself. Teach them about how debt can be crippling, but saving money and budgeting well can benefit you and your financial success.
- Let your kids make financial mistakes: Everyone makes financial mistakes at some point or another. You can’t prevent your child from making mistakes, but you can allow them to learn from it. For example, if you might try to example to your child the importance of saving up for a quality toy. However, they buy the junk toy and the junk toy breaks. They learned a valuable lesson in you get what you pay for.
- Teach your kids the value of saving money: It’s not realistic that you will be able to buy everything you want with one paycheck. Which is why children need to learn the value of saving their money. Saving money is something that a few adults aren’t even good at. If you can instill this value in your child, you’ll be doing them a great favor. Teach them about how your household finances work by letting them help you with things like couponing, weekly menu plans and budgeting. You can even let them help you create things like menu plans and vacation budgets so they understand how the best frugal decisions are made.
- Want versus need: If you have children who don’t quite understand wants versus need, this is a great lesson for them to learn. Having multiple children means that not everyone gets the same thing at the same time. Kids need to learn the value of being able to purchase what they need rather than what they want all of the time.
- Giving when possible: Nothing teaches a child to give to someone in need more than seeing it in person. Give your child a chance to see a person who may not have everything they have. Planting that seed to give in your child is a real life tip every child needs to know.
Teaching your kids about money is a big responsibility. It is something to take seriously not just now, but throughout their lives. Your example of how to handle finances and debt is what they will follow as they grow up and begin making their own financial decisions.
Do you have any tips to add?