Helping Your Child Manage Money

Helping Your Child Manage Money

Although money can be a complex topic, it is important to introduce to your kids. When children learn to manage money at an early age, this will benefit them for the rest of their lives. Here are three money topics to cover with your children, and ways to make it simple.

1. Spending

In order to teach your child how to spend, consider giving them an allowance. A few dollars a week for completing their chores is an excellent way to teach them the value of earning money. Then, when guiding them through the spending process, help them distinguish between needs and wants. Are the things they purchase necessary? For example, take your child shopping with you. Let them help you make some spending decisions, and stress the importance of staying within a budget. They can bring along a calculator to keep track of how much you are spending.

2. Saving

Give your child a piggy bank, or a jar labeled “Savings.” Then, each time they get their allowance, encourage them to put some money into savings for purchases that are too expensive at the moment. If they have a goal purchase to save up for, this will motivate them more! Once your child gets old enough, help them open their own savings account. This will help them more effectively set aside money for the future, and they can watch their investment grow!

3. Giving

If your child is involved in community service or volunteering, they will better understand the value of giving. Once they are old enough to understand this, ask your child what causes they want to support. Do they want to end hunger? Help an animal shelter? Give to foreign missions? Once they have decided upon something, find an organization that would use their money effectively, and help them make a donation. If they don’t have enough money for a significant donation, consider setting aside a portion of your own giving money for your child to give. They can either decide which organization to donate it to, or combine it with their own giving money.

There are many more lessons for your child to learn about money as they get older, but these will be built upon with time! Simple steps in their younger years will help them understand the value of money and using it wisely.