Teaching kid’s from a young age all about smart money is critical in their growth and development. I’ve created some helpful tips that will help your children grasp the concept of money from whenever you start implementing it!
You will get a FREE 10 Page Money, Chores & Responsibility Binder printable at the bottom.
1| Pay them for tasks and chores, but don’t pay them if they didn’t earn it.
Create a list of chores they can earn commissions from. This will teach them that money isn’t just handed to them, but instead comes from dedication, commitment, and hard work.
(Lexi (my daughter) has a list of chores that she can pick from every day.)
2| Don’t forget that children should know the difference between responsibilities and chores.
Being a part of a family requires a helping hand. If there is something lying on the floor—whether it was hers or not, and I ask her “Hey Alexis, can you pick that up for me please and put it in the garbage?” – I certainly am not going to pay her for something like that. Kids need to know the differences between responsibilities and chores – one is an obligation, and one is earning money.
Lexi has daily tasks that she is responsible for completing, and apart of her daily tasks are to pick 2 things off of her bedroom list and get them done as soon as she completes any after school homework (if she has any).
She doesn’t get paid for her Daily Tasks or Bedroom Responsibilities because they are simply her responsibility.
For the, young children, I think paying them for their own bedroom is a great way to ease them into the whole smart – money thing. As they get older though, their room becomes their own responsibility and they should be required to take care of it.
3| Require them to save a portion of their earnings.
Learning how to save from a young age can only do them good. If you can teach your kids early then they’ll grow to have a good understanding of money and be more aware of possible problems when they’re older – and how to avoid them.
(One of Lexi’s requirements to earning money is to save a portion of it. She has 2 separate savings accounts (and charity savings) and keeps a running total on her purchase tracker. )
4| Teach them the power of giving.
It really is a gift to give. Not only does it help the receiver—but the giver as well. Doesn’t it feel good to see a smile on someone’s face and know you helped make a difference in their day?
Making a difference can be done by a simple act of kindness and by ‘giving’, it teaches them how their action can impact others negatively and positively.
Set aside a portion of your child’s savings, and figure out a way to give back 🙂
You don’t necessarily need to donate it to a charity. You could do anything from doing something nice for a neighbor – to cleaning up the litter in your local park.
(On Sunday October 14th, when we went to a little park to play ball and Lexi asked if next time we come, can we bring a plastic bag to clean up the litter. And so we did!)
5| Give them the opportunity to earn some extra cash flow.
If your child is wanting something a little more expensive, give them the opportunity to earn extra money by doing extra chores!
Money comes from effort and hard work remember!
(If Lexi wants to earn extra money, she can do some more chores after school (which might cut into her play time though), or she can do her extra chores on the weekends.)
6| Simply teach your children about credit and borrowing.
This one is leaning more toward the older children because it can be a little complicated on top of everything else. But don’t take that as you shouldn’t start young—you can wiggle this one in there if you have a younger child too, but just make sure it’s really simplified.
If your child wants a nice jacket, but she was $5.00 short – you could offer to help her out. Sit down and discuss how much she will pay back on every payday until it is paid off.
7| Show them how to be a SMART BUYER
Help them be more aware of purchases. Teach them not to be an impulse shopper, and to make wise decisions when spending their hard-earned money.
If they see something they want, encourage them to take some time to think about it before buying. You can say things like “just remember that you wanted to save for ____, and if you buy ____ today then you won’t have enough money for ____”. You are at least helping them acknowledge their decisions first, and the pros and cons.
(A while back, Alexis’ and I were in Walmart and almost right away she said “I’m going to spend my money here at the toy-vending-machine”. I asked her “are you sure Lexi? You were excited to spend your money on so and so. Why don’t you take the time that we are in Walmart to think about it before making the purchase? If you still want it when we are ready to leave, we will go back and grab it.”)
8| Keep track of spending and saving with a bank account or a purchase tracker.
You can open up your child a bank account at any age and hold on to their bank card if need be. This might help with keeping track of spending and saving—and overall just give an extra feel with money.
Lexi and I keep track of her spending and saving on paper in a binder! (Which also comes in the 10 page printable that you’re getting for FREE!)
9| A head start on an education fund—or life savings!
Savings for any length of time is something to be proud of and it teaches a lot of priority.
What if I said “I saved for college/life savings since I was 7 years old!”?
Well, I didn’t.
I wasn’t exactly taught about money.
I want to give my daughter as much knowledge as I possibly can so we’ve created a life savings plan that we all put money into. Her plan starts with savings $1.00 a month at age 7 and doubles each year until she is 10.
Get your child to dedicate a certain monthly amount to set away for their savings/education.
10| Help them turn a hobby into a chance to earn some extra money.
This is a kind of a bonus.
If your child is really into a craft or hobby such as making jewelry, baking, making bath bombs and so on, why not help them find a way to earn money with it by making them a Facebook group and promoting it to family! Their opportunities are endless, and it can’t hurt to give them a taste of that as early as possible!
(Alexis talked about creating her own lip chap. She made her business name QT be-you-t, (LOL so cute) and she is making her own labels and figuring out different colors and scents. We will totally update when she has some product and pictures!!!!)