Saturday, March 19, 2016

Teaching Kids About Money

We've made it to PART IV!  If you missed this series you can check out the other posts by clicking on the images below. 
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As I have said before, kids are going to learn about money from us one way or another.  As parents we can choose to teach them or hope they will figure it out.  

Creating Opportunities
You don't have to have a set plan to teach kids about saving, spending, and giving.  BUT creating these opportunities will help facilitate the learning.  Kids will come across birthday money, Christmas money, tooth fairy money.  Help them make the decision to set some of it aside to save.  You can also create a checking account for your kids and put money in it every month.  Show them every month how it grows. Give your kiddos your spare change and let them put it in a jar.  Over the years see how those coins turns into dollars.  My dad use to do this with us as kids and I remember cashing those quarters for $100.

When you go to the store, start carrying cash.  Let kids pay for the groceries or their new shoes using cash so they see how much money is actually being spent.  I read this article of a dad taking home his monthly check all in cash.  He sat down his kids to show them and then handed them all the bills.  Dollar per dollar they used the cash to pay off each bill.  There is a lesson those kids wont forget!

There are always opportunities with giving.  Let kids bring part of the family tithe to church to give in the offering.  My aunt took each one of her sons out to buy their brothers a Christmas gift.  They got to have a special day with mom but also experienced the joy of giving.  She told me they were just as excited to see their brothers open the gift as they were about their own.  

There are endless opportunities to teach our kids about money!  Find opportunities or a method that works best for you.  

Chores, Payday, Managing Money
Yesterday I shared that we give an allowance and why we do.  Our approach to teaching the kiddos about money is a little more direct but it is simple.  This is a trial and error system and I am sure it will change as they grow older but for now it works.  If you choose a more direct way, the best system is one that YOU ARE CONSISTENT WITH.  It doesn't matter what it is, but if you aren't consistent with the type of chores, pay day, and managing days then it won't work. Teaching them starts with you and you have to be the first to commit to the system. 

With that said, because she is only five I've kept everything super simple.  I found this great chalkboard chart at Target for three dollars.  At the end of every day I check off what chores she has completed [making her bed, emptying the dishwasher, cleaning toys, laundry, clearing/setting table].  Notice that some of these are contingent on me completing my chores.  Great motivator moms.  She can't put away laundry unless I have it done or empty the dishwasher if I didn't run it. 

Payday for us is twice a month, the 15th and 30th.  She gets a quarter for every chore that she does, which I would say is pretty fair.  If you do quarters, be sure you get $20 worth at the bank.  Then we follow the 1/3 rule.  

She has a wallet for spending, a piggy for saving, and wallet for giving [to the church and chapel at school].
Each Sunday she counts her X's and she get's her quarters.  It's divided up into three equal parts.   That's it!  It's so simple but we've seen her learn some awesome life lessons with this system as you've read in the last post.

The key to making a system like this work is being consistent.  It's doing it with them so they can learn.  I can't wait for her to save her first $100 and start investing it.  Money doesn't grow overnight but it does grow over time.  It is a habit that is developed and it takes discipline.  I share our method with you in hopes to encourage you to start seeing those opportunities and maybe even create a system in your home to teach your kids about money.  

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