how do you teach your kids about money?

@cher913 (25865)
Canada
June 1, 2009 4:10pm CST
a lot of kids today have no idea how money works, what compound interest is, how to spend money wisely and when they get out to the real world, they are in for a big shock! the key is to start them learning about money at an early age. i heard of one fellow that started a small business for his daughter when she was 9. that gave her experience on how the real world works. do you give your kids an allowance? do you make them divide it up (ie save so much, spend so much etc). i know parents that don't charge their adult kids any rent money. what a disservice! when they get out on their own they wont have a clue!
3 people like this
13 responses
@suzzy3 (8352)
1 Jun 09
We have always been very honest with our kids if we cannot afford it we tell them. Expect them to do jobs around the house washing up ,cleaning their own room.walk the dog ect and reward them with a few pounds at the end of the week so they realise they have earn't it.I totally agree with you when they start earning a wage on a regular basis take rent or keep off them.Other wise they never get to know about life it is a lesson we have all had to learn,if you cannot afford it leave it in the shop.My son is old enough to do a saturday job and work the holidays so he will finance his life,only food and a roof over his head while he works.Sounds hard but like the others he must learn to budget,we won't let him go unshod of course just get him to realise how hard it is to earn,and how far money goes.It is a tough world out there and sheltering them to much does them no good in the long run.
1 person likes this
@ellie333 (21018)
1 Jun 09
Hi Suzy, It seems we have similar views on this and I agree our children will thank us when they are older. I have three 23, 18 and 5 and even the five year old knows that if he unloads the dishwasher he gets an ice cream when the man comes round in a van on Sunday but if he doesn't I say no and stick to it. We are both teaching very good lessons in life here. Well done you. Huggles. Ellie :D
@suzzy3 (8352)
1 Jun 09
Goodness me you had a gap didn't you.Mine are 34,31,and 15.Beat you on the gap though,now I know whats causing it won't be having anymore.
@ellie333 (21018)
1 Jun 09
Hi Cher, I have taught all three of my hildren from a very young age and they are all excellent with money including my five year old. When the girls were younger they had to work for their pocket money. I had a wallchart of chores,hoovering, emptying the bin etc and they had to do one of of the list each day and tick and they would get paid at the ned of the week but if they messed up and misbehaved they got it docked. My eldest is at uni but my youngest when she started work without me asking automatically gave me a third of her wages for her keep, this is realistic and they both work hard and provide for themselves and budget and save well. Parents that give give a free ride set them up to be spendthrifts who get into debt at a young age and suffer for a lifetime because of it. Cruel to be kind eh! Huggles. Ellie :D
@suzzy3 (8352)
1 Jun 09
Sounds like you have a good balance of life for you kids,they will thank you for it and love you more as you are truly a good parent.
@mama_bear (1121)
• Canada
2 Jun 09
i think that one of the best things a parent can do for a child is teach them the value of a dollar/money. the only way that this can be done is if you make your child earn the money that you are giving them, don't just give it, assign tasks for the child to complete before they can be given the money. you do not necessarily have to start a business for the child because that is extreme in my opinion. if a child wants something from the store for instance, like a game or comic book for example, then initiate a program whereby the child will carry out tasks in order to earn the money to purchase the said item. in some cases even tell the child that you will meet them half way and half finance the endeavor but they must do the rest. this will teach them to value money and that the parental unit is not a bank of sorts. you can carry this exercise out till they are out of your home. and when you lend them money when they are older, actually, prior to this you must make the clear distinction between a loan and giving the money. when you give the money then this means that the money does not need to be paid back. when the money is lent then there is the expectation that the money is to be paid back.
• United States
2 Jun 09
I don't give my kids allowance..and never have. I may start though, after reading a few articles from this site called 'give me 20'.
@di1159 (1580)
• United States
2 Jun 09
Money management skills are one of the best things you can teach your child. I opened a savings account for each of them when they were born where I make small deposits when I have a bit saved. They also have a small allowance and the easiest way I teach them is to tell them they have to deposit 1/2 into their account for the future. Little by little, they start to realize the value of money. Now when their birthdays come around and they usually get money from their grandparents and friends, they usually want to go the bank the same day and deposit it. My son who is older than my daughter, is starting to think twice about what he spends and where he spends it. He's gotten pretty good on budgeting matters. This summer, I've arranged for him to get a part-time job so he can experience what if feels like to work for money. Teach by being a good example and teach them how to save. Good luck!
• Canada
2 Jun 09
There are a lot of fantastic books written for youth about money. They explain how money works, compound interest, how to invest, what to invest in, how to set long term goals, all that good advice. And some of them even come with options such as games to play to make it a bit more fun to learn about. To find books like these, I just went to Amazon and filtered the topics in the finance section and theres a whole section devoted to younger people and investing.
@Mitobid (57)
• Malta
2 Jun 09
To teach kids about money you need to let them experience the highs and lows of it. Try to get the into properly managing there money, and get them to stay away from debt and taking loans. So by giving your child some independence with money (all be it closely monitored independence) they can experince and learn about money
@calyxus (827)
• Philippines
2 Jun 09
When I was a little kid, my parents would tell us to save something from the money they gave for our allowance. So we make coin banks out of empty plastic bottles; we would slice a hole in the bottle for the coins to enter. Then out of what we save, we could buy things that we want like a new piece of clothing. Moreover, my mother would encourage us to sell candies to our classmates at school to subsidize our expenses for school projects. Well, that was how we were taught by our parents regarding money matters.
@akumei1269 (1750)
• India
2 Jun 09
This is a very inportant responsibility of parenting.It is difficult too to be in right direction. My child is 6 years old and in 1st standard. He doen't have to take any money while going to school, because, he takes his tiffin box with him and there is no scope of going out alone or with friends.So, no question arise of money in his case. But i am trainning him to save.I bought a saving box for him and advised him to put a few rupees everyday taking from me so that he could buy some of his requirements.He does it , of course not regularly.
• Philippines
2 Jun 09
There are so many things you can teach the child how. and the best method is to teach them how to save money and only purchase that's important and needed and not is that a person wants and threw it away later on. there are times i gave my niece some money for them to keep it in their banks and not buy to much stuff that is worthless and not worth buying..
• United States
2 Jun 09
My kids are young, but I believe in starting them young. We pay them one dollar a month per year old they are. My 4 year old makes $4 and my 7 year old makes $7. We ask them to save 10% in a long term savings account. 10% goes to tithe, and the rest they use as they see fit. We talk to them about the money choices they make and help them understand the choices we make. We have not had to yet but we do offer credit to them at a price. They can borrow money from us but we require monthly payments and charge interest at 10% a month. I know this is high, we hope to deter them from getting debt later in life. They are pretty good at saving for what they want. We also offer extra money chores. These are things that I would normaly do but they can pick up for extra cash. For example, my 7 year old can mow the lawn if he wants to earn some more, they can sweep the sidewalks, they can bake bread. I have magnets made up and I just put up the magnets of the chores they can choose from. At least they will have some savings built up. We also have them help with the food budget and shopping. They help me do the math, plan the meals and clip and organize the coupons. My Hubby didnt have a clue when I got him and I had to teach him what I knew and learn what I didnt. Life would have been easier if we had both learned it when we were younger.
@ShepherdSpy (8561)
• Omagh, Northern Ireland
1 Jun 09
I don't have kids Yet,but I'm all for the idea of teaching them real world practical financial applications at home and in schools..Algebra and Geometry may be important applications within mathematics,but Arithmetical uses such as how to understand APR's, Credit card interest calculations,Loans,Hire purchases and mortgage payments would be way more useful to them in day to day life!
@jayrene (2712)
• Philippines
1 Jun 09
i started teaching my kids about money, when they were able to learn how to buy at the store... here we have lots of mini store where you can buy goodies, candies, cookies, and whatever per piece. every day i tell them how much they can ask from me, how much they are allowed to spend. and when they started going to school they have their own allowance that i give daily and its not really much, its just enough for recess and fare. when we go to the mall and pass by the toy store i tell them how much the cost of the toy they are allowed to get. and if they want something that is out of my budget, i will tell them to save for it, which they do. my son had bought himself a transformer toy from his savings... it did cost a lot, and he plays with it carefully, so it will not get broken right away, because it was expensive and he saved for it for a long time... my daughter saves money to buy cartridge for her gamebo advance, and ds. up to now they they both each have their own piggy bank.