Teaching Your Kids About Money
As parents, we are our child's first and best teacher. Our kids come into this world as little sponges ready to soak up every bit of knowledge. We are their models for so many things, from social interactions, to personal hygiene, to financial habits.
A 2019 VisaUSA survey found that 75% of college students depend on their parents for financial advice. We are faced with the amazing task of raising children in troubled economic times. Like most parents, we want our son to grow up to be a responsible adult, including in the area of finance, but how do we tackle this monumental task?
- Teach them to earn their money: consider having a work chart (or commissions) for allowances. Pay children a set amount for certain chores. Payments do not have to be in the form of real money. I know families who have their own form of currency (poker chips, printed cards, etc) and children earn their "money" and use it for special things.
- Teach and Model the 10-10-80 rule: help you children understand the idea of saving, giving and spending. This not only sets up for good money management, but also teaches the joy of giving.
- Let them be a part of the family budget: Now, I am not encouraging you to let your children know how much you earn, or every little detail of your personal issues. But kids need to know their parents' budget. Show them that keeping the Xbox turned on overnight costs electricity. This is especially beneficial for kids as they reach the college age.
- Encourage learning: visiting sites like Dave Ramsey's Junior Clubhouse or Money Instructor provides kids with fun and interactive ways to practice their money skills. Playing "store" or having a lemonade stand are also great ways to help kids apply their finance skills.
We pray that our children will inherit a better world, a world of peace and prosperity. We also pray that God helps us equip our children to succeed, and teaching financial responsibility is a huge step.
How do you teach your kids about money? We would love to hear your ideas! Please leave a comment.