Posts tagged Kids & Money
“Mommmmmmmmmmmyyyy!!! Pleaaaase! You NEVER buy me anything!!” If this sounds familiar, this blog post is for you! If it doesn’t, read on for some tips to help your child earn money, and also learn to value money and effort.
When you’re just starting to introduce the idea of earning money to your child, and your child asks for something at the store, if it’s an ethical YES from you, but you don’t want to buy that thing for your child, you can enthusiastically answer, “Yes! Let’s find a way for you to earn the money to buy that! Would you like to write down what it is and how much it costs, so that we can come and get it once you have the money?”
As your child begins to learn to earn and save money, you’ll be able to say, “Hmmm…that’s not in my budget today, do you have any spending money or is that something you’d like to save for?” Parents who’ve done this consistently, AND seriously supported their child to find ways to earn money (see next paragraph) find that their children rapidly stop begging for things at the store.
To help your child learn to value things appropriately, find ways to support your child to earn and spend his or her own money at a young age. Since age 3, my daughter has been taking back bottles for grandma and grandpa (with my help, of course). At age 4, she held her first lemonade stand, and paid back the cost of the lemons, honey, ice, and little cups. At age 5, she picked weeds for grandpa at the cabin for 5 cents a weed, and made Christmas cards to sell at a market. At age 6, she made ceramic necklaces with my mother, an artist, and sold them at a market and on Etsy. At age 7, she participated enthusiastically in our garage sale, selling her own things. At age 8, she sorted through her baby toys and I posted a “Living Room Sale” on Facebook. For several weeks, people made appointments to come to our home to buy her baby things, she ran the sale, and we split the proceeds. Now, almost 9, she has a dog walking business called “Small Dogs Only” and has had a few sporadic and one regular client.
With each new experience, she begins to see how much money is needed to reach a specific goal. 80 weeds were enough to buy an ice cream. Three bags of bottles is enough spending money to make it through a four-day summer festival, with all the ice cream you can eat and probably a special silver ring or t-shirt. Two months of bottles and 3 weeks of dog walking earns enough spending money for 10 days in California. Two regular dog walking clients, twice a week each, plus savings of about $1000 (she’s halfway there) is enough to get and maintain her own dog, including medical care and pet insurance, spaying or neutering, food and toys, occasional pet-sitting when we travel, etc.
Supporting your child to earn his own money is a significant time investment on your part, but well worth the effort. It establishes you as a mentor, helper, and gives your child an understanding of interdependence, and confidence in himself.
Another key to helping your child learn to value money and effort is to sit down with your whole family and write a list of all the things that need to be done to run the household. This includes things like “Pay mortgage”, “Pay for lights, heat and water”, all the way down to things like, “Feed the cat” and “Empty the dishwasher”.
This long and complete list will help your child put everything you need to do and spend money on for the home in perspective. After making the list, all family members can step forward to say what things they will take responsibility for.
Then, when you’re at the store, you can also say, “I have set aside this money to pay for our mortgage, our food, and our heat. I have $2.50 of extra spending money on this trip, the rest of our money is for our regular expenses.”
As an added bonus, doing this together with your child can help him or her know that his or her efforts are valued and that he or she is and important part of the team that makes your household work.
Stay tuned for my next blog post to address the tricky question of whether or not to give an allowance!
And please tell us below what works for you and your family! We’d love to hear all your money-related tips!
You can read the first two blog posts in this series, too! Go here to read about How NOT to Have Grown Up Kids Still Asking You for Money, and here to find out if you’re Sharing These Key Money Skills With Your Kids.
So, if you’ve read my last blog post, you’re on the right track to getting your messaging around beliefs about money down. The next step is to figure out what practical skills your children are learning about money management and how money works. Here are a few basic ideas that can be shared and reinforced overs years to help your child get a strong foundation in the basic concepts.
One of the key ways to reinforce these ideas is to share out loud what you’re doing when it involves money. Involve your child in as many of your banking and paying transactions as possible. Either explain what you’re doing, or have him or her help with the process.
Here is some key information and important skills to share:
Money needs to be stored in a special place to avoid losing it. There is no need to elevate money above other things, though – help your child take care of ALL the things he or she is a steward of, from toys to clothes to food to pets, by storing and caring for things appropriately.
If you find money, big or small, pick it up, return it to its owner if possible, and if you keep it, store it carefully. Remember that you are teaching processes – whether it’s a penny or a twenty.
Start with which coins are worth more than others (age 2+). Later, name the coins, and help your child figure out how many of one kind of coin makes another (ie 2 nickels are the same as a dime, 4 quarters equal a loonie, etc) (age 4+). When at the store, ask which things cost more and which less (age 5+). Money math is a great way for a child to be motivated to learn mental math, and eventually, a child can do basic record keeping and set and track savings goals (age 5+).
Splitting money up from the beginning makes it easier to understand the value of money. My daughter splits all her earned money into thirds. She has a “Save Forever” account, a “Dog Fund”, and spending money. The “Save Forever” money is for something big and long term, and we talk about it all the time. It may be so that she can attend a special university, buy her first home, take a trip to a special destination, or all of these things. Her “Dog Fund” is so that she can have her own dog. Her spending money is shared with charities, used for gifts for friends, and used for her own spending choices.
Take the time to explain how a bank works, and how a credit card works. Draw a big red line on a piece of paper, and set out, or draw a picture of each option. On one side of the line, show your child all the different ways to pay for things WITH YOUR OWN MONEY, and then, on the other side of the line, show your child ways that you can pay for things WITH BORROWED MONEY that you have to pay back. Introduce the concept of interest as soon as your child understands it (5+).
Show your child that the way we spend our money doesn’t just mean WE get something – it has a much bigger effect. The systems that produce the things that we spend money on are supported by our money. If we don’t want to support certain situations or products (child labour, the production of cheap plastic that just ends up in the landfill, unfairly traded goods, etc), then we can choose not to spend money on things produced by those systems. On the other hand, we can support things we believe will make our world better when we spend our money, too (local businesses, eco-friendly products and services, fair trade, organically grown food, etc).
You don’t have to send your child to money school to share these messages – just share what you’re doing, and help them along the way to understand the next idea that they’re developmentally ready for. If you share something, and they don’t get it right away, try again a few months later, and remember to repeat and build on key ideas over years.
Keep your eyes open for my next two blog posts – How to Stop your Kids from Begging for Stuff at the Store, and The Allowance Question.
In the meanwhile, if you haven’t read my post about helping kids develop healthy beliefs about money, check it out!
And please share your experiences with sharing money skills and ideas with your kids below!
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