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Health & Fitness

Money and Life Lessons for You and Your Kids

Do your children understand money? Do you? Learning to organize and understand money is a necessary part of growing up. Here are some ways to start the conversation!

    Do your children, big and small, understand money? Do you?!? Learning to organize, understand and manage money is a necessary part of growing up, but your children may not hear about budgeting, bill paying, or the value of a dollar in school. Like all life skills, the sooner we start teaching money skills, the better our children will learn the lessons.

What Lessons Do We Want To Teach Our Children About Money?

Very young children:

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  1. Set up a savings account in their name  
  2. Understand that we exchange money for goods and services 
  3. What money looks like

Young school age children: 

  1. Value of a dollar – what goes into earning a dollar, and what it can buy 
  2. Money is finite, and Money spent on one thing can’t be spent on something else

School age children:

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  1. A healthy understanding of your financial views
  2. Value of work
  3. Appreciation for money spent
  4. Budgeting and delayed gratification
  5. How advertising works
  6. Charitable Giving and Savings

High School age children (list is endless, but includes): 

  1. Household budgets and salaries
  2. Costs of higher education
  3. Benefits and pitfalls of credit, establishing a good credit score
  4. Investments, interest and stock markets

 

How Do We Teach Money Lessons to Our Children?

Let them handle money. Give them their own money, and let them earn more money by their own hands. Our boys earn a set allowance (the dollar equivalent of their age every 2 weeks) for regular chores, and can earn more for extra projects.  This is just my view on children’s allowances or salaries, I respect others, too! 

Lead by example. Start with a grocery store trip.  Review the weekly store fliers with the kids, and make your weekly menu and shopping list. Show your children how to compare prices and quality on favorite products. Discuss brands and advertising. Use coupons and sales to save money.

Limit today’s lessons to those your kids are ready to learn. Use small words and real world examples. My youngest won’t grasp tax rates and investments, but he understands the exchange of money for goods and services. He also knows that if he wants that new game, he needs to save his allowance, do extra chores or ask for it for his birthday.

But, Don’t dumb it down. My 14-year-old helped my husband pay bills last week, to better understand our family finances. Involve your kids in financial conversations. They don’t need to know the details of your finances, but they can listen as you discuss major projects and budgets.

Teach gratitude and giving. My family is blessed with all that we need.  We encourage charitable giving of money and belongings from a very early age, like donating books and toys to charities, and helping us with service projects.  Helping your children recognize how blessed they are with what they already have can help to counteract the “wants” list, and curb spending.

Your children’s money education starts with you. For more information on these topics, check out these resources:

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