Six Fun Ways to Teach Your Kids About Financial Responsibility
We’ve all seen the meme about schools teaching our kids (and us) to do parallelograms instead of how to do our taxes. Understanding how to save and spend money is an important life lesson that’s often skipped over.
And what kids know about money at a young age will shape the way they manage money in adulthood. What better way to strengthen your family’s bond than to work on saving together? But worried you’ll teach them something wrong? Because – let’s face it – many of us adults still struggle with managing money. We’ve got some suggestions below and be sure to download our Parent’s Guide to Earning & Learning.
Needs vs. wants a game
When teaching your kids about making good financial decisions, it’s important to start by distinguishing between what’s a necessity (needs) and what’s just nice to have (wants). Explain that needs are what families should spend their money on first – food, shelter, and medicine. Meanwhile, wants are things such as toys and vacations. These should only be bought after needs have been met.
Let’s make it a game. Take a piece of paper and write ‘Needs’ on one side and ‘Wants’ on the other. Go around the house together and point to different items. Have your kids determine what type of item it is by holding up the correct side of the paper. If you point to food this would be a need. And if you point to a toy, this would be a want.
Earn their own money
Find a unique and fun way for kids to earn money. Let’s say they want to purchase a new video game, instead of buying it for them, show them how to earn enough money to purchase it themselves. On top of that, have them pay the cashier so they can see the money leaving their hands. Here are some fun ways for kids to earn cash!
- Garage sale: have your kiddo clean out their old toys, help them price items and host a garage sale.
- Lemonade stand: I know what you’re thinking, ‘Do people really still do lemonade stands?” and the answer is YES! It doesn’t have to be lemonade, but they can be a modern-day Lucy from the Peanuts comic and shell-out advice to passersby. Let them work at the stand and collect the cash as a reward.
- Extra chores: have a list of chores that your kids can do to earn cash. Let’s be real, unloading the dishwasher isn’t your favorite chore, anyway.
- Babysitting: for older kids, babysitting is the perfect way to earn money. • Yard work: mowing the neighbor’s lawn or shoveling snow.
Teach your kiddo to save for special items. Start by sitting down together to create a budget. (Example: if the item is $100 and they save $10 per week, they’ll have enough to purchase their item in 10 weeks). Create a fun chart to show their progress and every time they deposit money, they get to color in a bit more of the chart.
There’s an abundance of free online resources that can help you teach your kids about money in fun ways:
- Education.com: Kids learn a variety of skills including identifying and ordering coins according to their value. Geared toward first and second graders.
- Mymoney.gov has lots of information and fun games that teach recognition of different bills and how the money adds up as you collect it.
- TreasuryDirect KIDS has great information and games.
Pay it forward
Giving back to your community, and those in need can be an impactful financial lesson. Volunteering with your kids at a local nonprofit (think animal shelter or food pantry) or city-wide clean-up day can really show them a different view of the world and help them develop empathy and generosity. You can also encourage them to gather up old toys they don’t play with anymore to donate to a child in need.
Come to IHMVCU Credit Union and open your kid’s first (or second) account.
Don’t do this alone. Bringing along your kid to show them where they can safely store their money and watch it grow can be one of the best ways to teach your kids to save their money.
Our Balance Builder Savings Crew account gives kiddos the opportunity to learn some basic financial literacy from our experts. Plus find out how you can receive a $50 deposit match. Our team members will show them how to keep track of their money and start good saving habits now. It doesn’t have to be a one-time trip instead we find bringing a child in to make their own deposits can really show them how big of a deal it is!
About the Author
Pam Lowe is the branch manager of IHMVCU Merle Hay Financial Center located at 3990 Merle Hay Road. She has a passion for helping members consolidate their debt, save on monthly payments and pay off their debts sooner. When she’s not chasing around her two boys with her husband, you’ll find her on the patio enjoying the big game.