An opportunity to educate your kids about money

04/23/2020

 

If you have kids, now might be a good time to talk money with them. Use this social distancing, stay at home time to teach your kids a few smart money skills and maybe help you save a little money. You might be amazed at how many opportunities you really have to teach fundamental financial skills.
 
How old do kids need to be to start understanding the basic financial concepts?
Typically kids in the 3rd or 4th grade can begin to learn the basic concepts of money. Probably not surprising is that teaching kids early can pay big dividends later as they have more control over their spending and other money habits.
 
What is the first lesson to teach kids and the best way to do it?
Needs versus wants is the first concept and grocery shopping is a great way to teach them this very basic concept. Have them help you complete your online order and talk about the choices you are making on what you are putting in your cart and what you are not selecting because it is a want and not a need for this week’s meal plan.
 
Are there other shopping lessons to teach your kids?
One of the best is to teach them to always comparison shop any purchases they are planning to make. As you are making purchases, ask them to research products for you and see if they can find the lowest price. You might be surprised at how skilled our younger teens can become at finding good deals.
 
What is another important lesson to teach children early in their lives?
Saving for a special purchase. Being at home might have created pent up demand for games or toys. Give them an allowance for doing chores around the house each week.  Using online transfers to their account or maybe even putting funds in their mobile wallet, let them see how quickly they can reach a savings goal for something that they want to buy.
 
What should parents be teaching their older teenagers?
This is a time to start teaching them how to live on a spending budget. One of the best tools is to use an allowance and responsibility approach. Give them money and also assign them financial responsibility such as paying for entertainment and maybe even gifts for others. This approach can help parents reinforce good spending habits.
 
Any other skills to teach your kids regardless of the age?
The one that might benefit people the most is to have your kids find coupons and discounts on the regular items you buy, especially if you are not the couponing type. Split the savings with them and it becomes a win/win for you and your kids. Rewards are always a great tool to reinforce desired behavior.

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