5 ways to teach your kids how to save money

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5 ways to teach your kids how to save money

Teaching your kids about money is very important, right? Sometimes knowing how to teach them about the “root of all evil” can be a tough pill to swallow. Okay, so money is not ALL evil, if you know how to use it. ;)

Here are 5 ways you can teach your kids how to save money. Why not start them early?

#1. A clear jar
One of the best money teachers out there (Dave Ramsey) teaches that kids should save their money in a clear jar. The clear jar is a visual concept to teaching kids about money. They put their money in and see how saving takes time and energy. It’s fun for kids as well because they earned the money that’s going into the jar.

#2. Teach your kids about budgeting
While your kids may not have enough money to do their own budgets, you do. You can have your children sit with you as you budget each week or month. You do not need to make this a scary time for them, simply get them involved in budgeting things like groceries, gas, and games. They need to understand that money needs to be set aside and every dollar should be accounted for. Of course, they are going to learn by watching you.

#3. Kids need to learn things do cost money
There is only one way to really teach your kids about money and that is to show them that things do really cost money. If a child wants to do something “fun” then that is the perfect way to show them how much things cost. Let’s say you have $20 for an activity set aside, but the activity they want to do is $30.

This is a perfect example of how some things cost more money than what you have in your pocket. All the child can do is choose an activity for $20 or simply walk away and learn from this valuable money lesson.

#4. Let them learn the hard way
Some of our most valuable lessons are learned the hard way. If your child “must have” something but does not have the right amount of money, then they’ll have to learn that they can’t buy it. You might feel sad for your child now, but isn’t this a better lesson learned now rather than later?

#5. Give your child choices
As adults, we are faced with choices about what we will spend our money on. Don’t be afraid to give your child choices when it comes to spending (and saving) money.

For example:
Parent: Johnny, would you rather buy this toy for $5 now or save your money and buy this toy for $10 later?
Kids can learn a lot from waiting for things instead of experiencing instant gratification.

As you can see, it’s not very hard to teach your kids about money. The worst thing you can do is not teach your child at all. It’s never too late to start teaching your kids about the value of money, no matter their age.

What is one way you have taught your child(ren) about money?

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Comments

  1. Kris says

    My daughter, now 16, has been buying her own electronics (video games, iPods, etc.) since she was 9. When a birthday or Christmas is coming up, she tells people what she is saving for and requests cash or gift cards. She still has her first iPod touch that she bought at 9.

  2. KMom says

    Great tips – Thanks!

    BTW, thought I’d mention that it’s actually “For the LOVE OF money is a root of all kinds of evil.” (1 Tim 6:10)
    :)

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