It's important that kids understand the value of money from a young age so that they can responsibly budget, save, and spend money as they grow older. Now, with the rise of online shopping and the lack of physical money being used, it's hard to differentiate between wants and needs, as well as keep spending within a set budget. We have prepared some tools and activities you can start doing with your kids to get them set up for future financial success in their lives.
Teach Your Children How to Shop for Groceries
Grocery shopping is something that everyone will have to do on a regular basis in their adult lives. You can start by taking your kids to the grocery store on your weekly trips to teach them how to look for sales, the importance between wants vs. needs, and how to stick within a budget. Have your kids help make a shopping list with you, pick out items from the shelves, and pay at the register. In the future, you can have them use cash to pay but for now, let them insert or tap your credit/debit card to pay and you can tap in your pin.
Important things to discuss with your children:
how you decide which products to buy
why you bought, or didn’t buy, the sale item
when you might buy an item individually and when you might buy it in bulk
how you pay for the item, for example, with debit, credit or cash
Important activities to do with your children:
check for weekly in-store specials
look for coupons for items on your shopping list
check the cost of similar products made by different brands
discuss the reasons behind differences in price
Giving Children an Allowance
Giving an allowance is an individual parenting choice, but it offers a great opportunity for children to learn about the value of money — such as how to save and manage their money. Before starting an allowance, you will need to choose an amount that is appropriate for their age (consider starting with a smaller amount) as well as what they need to do in order to earn their allowance. This can include a weekly list of chores that are specifically their responsibility. Chores can include washing the dishes, taking out the trash, or doing their own laundry. This also instills a sense of work ethic in your children, as well.
Allowances also offer the ability for kids to pay for wants in their lives, such as seeing a movie with friends, buying extra clothing, or purchasing a video game. It's important that you teach them to set aside a certain amount of money each week for savings, such as a college fund, before spending their entire allowance on "wants." You can also use this as an opportunity to talk about short- vs long-term savings goals. For example, buying a new pair of sneakers is a short team savings goal but buying their first car is a long-term savings goal.
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