If you struggle with how to teach smart financial habits to your children, start with looking at all the opportunities that the holidays can provide for financial education. Modeling good financial habits in a time that traditionally is all about forgetting smart money moves is a great way to help your children learn how to live a financially successful life as adults.
- The first concept to teach your children is that they should only spend what they can afford. Help them find gifts for all the people on their list using the money that they have instead of you buying the gifts for them.
- Help them remember that their aunts, uncles, teachers and everyone else on their list value thoughtful gifts rather than expensive and sometimes unnecessary gifts. The though really does matter.
- Have them build a list of ideas of what they want to buy before they start looking online or visiting stores. Teaching them the value of using a list to avoid overspending is a key habit they will learn from the holidays.
- Remind them that holiday shopping really requires a simple budget. Show them how to set an amount to spend on each person and help them decide if they are staying within their means for the holidays.
- The biggest money habit you can instill in them is to avoid using the holidays to buy gifts for themselves. Talk with them about the meaning of the holidays and how buying for themselves can cause them to overspend. You might be surprised at the importance of this lesson.
- Finally, help them understand the reasons for comparison shopping for all of their purchases. They are probably as adept or even better at finding different places to purchase their gifts. If you can create enthusiasm for finding a good deal, they will carry that forward to the rest of their life.