When it comes to raising kids, who are smart about money, it can be daunting to try and figure out how to teach essential skills and habits. All parents want their children to eventually understand and use a budget they can adhere to as they segue into adulthood. This is especially true when you, the parent, never learned the lessons you are planning on teaching – money is a difficult subject for everyone. However, if you find the right method for teaching your family how to talk about and use money, you can raise money-smart kids.
Teaching to Your Child’s Age
One of the biggest issues with teaching children about money is finding what is appropriate for your child’s age and expanding on the information as your child grows. It all starts with a piggy bank and identifying money, so your preschooler can easily learn and build upon that as they get older. A school-aged child can begin to understand budgets, and young adolescents can begin to see where savings and giving can come into play. For teens, it is all about real-world and tangible situations that prepare them for their first years of adulthood.
When Times Are Tough
One of the hardest things about handling money is figuring out what to do when times are tough, and it can be extremely hard when it comes to teaching that to your children. It can be heartbreaking to explain to children that the one thing they want in the world is simply not in the budget. As financial expert Suze Orman says, “People first, then money, then things.” A great thing about being a parent is that you know your kids and you know what they can handle – it is possible to see this as a chance for growth and understanding. You can use your children’s banking and savings efforts and relate them to how you handle the family money.
When Everyone Else Has It
One of the hardest aspects of dealing with allowances, budgets and savings for kids can be seeing a material object that another kid has. It doesn’t matter if the object is a bike, a pair of shoes, a video game or even a car – there will always be a point when your kid watches another kid receive something that seems too easy. This is when something like dojo can really come into play. It is a chance for you and your child to really look at money and set up a new goal or see how well you build towards a new one. You can easily empathize with your kids when they express frustration over the comparison to what other kids have and work with them to produce a solution they have an active role in creating.
Figuring out a Budget
There are many ways to split a paycheck, and for kids, there are just as many ways to split an allowance. Knowing what a budget is and how to build it are things you need to discuss with your children. These are things you can sit down and work out. Start to think about these things in ways you have never considered for your own budget – it’s all about seeing how you can slice the pie to get the best results for both you and the ones you love.