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Money advice for kids: What you need to be sharing and why
How do you decide if and when your kids are ready to talk about money? While there is no timeline that will look exactly the same for every family, you can still use some general guidance to help know when it’s time to have the money talk, and what you should say. Read on for some ideas on ways to start financial conversations with your kids.
Get everyone on board
If you and your spouse or partner are raising your kids together, you need to talk to each other first to make sure you both agree on what type of information to share and when. You might even want to write out a game plan or schedule to help you hit the points you want to emphasize to your kids. Having your thoughts written down will help you steer the conversation in the direction you want to go.
How young do I start?
For those with younger kids, you’re probably wondering if this even applies to you. Talking about finances can be useful for most ages, but it’s reasonable to wait until you feel your child has a better concept of supply and demand. This doesn’t mean they need a full understanding of global economics; rather, they just need to realize that there is a cost associated with things they want (i.e., if you want a snack at school, you have to sit down at the table first). As your child grows more familiar with these concepts, you can begin explaining that most things cost something, whether it’s money or time or something else.
What do I say?
Each family is different, but you can still work through some basic concepts that should apply across the board. Work on age-appropriate ways of introducing finances to your children when you feel they are ready. Here are some ideas on how to get started:
Young children: Begin the conversation by using an example they are familiar with, like the grocery store. They may have to choose between two items they want because you are only budgeted for one, or you might show them how you count out the money you use to pay for your grocery order. They don’t need to be able to add up the total, but seeing that money is exchanged for goods or services is a great first step to understanding a budget.
Older children: If your kids receive an allowance or earn screen time and other privileges through chores, this is an opportunity to help them understand the idea of budgeting and saving. You can show them how they have to think ahead – their allowance is only given at certain intervals and they need to make the money last until the next allowance payment if they want to continue to use their funds. That may mean waiting to buy a favorite toy or new item of clothing, or looking for less expensive alternatives. Either way, you can begin to show them how they have to use their money to pay for each item they wish to purchase.
Teenagers: Typically, even young teenagers have all of the cognitive resources to understand the concept of money only lasting so long and for certain items or services. Talk to them openly about why budgeting matters so much, and how they can create a budget that is specific to their needs. This is also a great time to shift some financial responsibility to them – they don’t need to take over your mortgage, but they can begin to fund small purchases, like their cell phone bill or going out for meals with friends. If your teenager has a job, it’s also a good idea to show them how saving now can make a big difference later.
Adult children: Every parent knows that just because the kids are out of the house doesn’t mean their job as parents is done. As your child leaves home for college or a job, offer to sit with them and help them budget for this new phase of their life. They may need to cover rent, utilities, groceries, and many other things they have not tackled alone before. Prepping them early will help, but it’s still a good idea to review their budget with them if they’re not confident in their spending habits.
Why does it matter?
Some of us had to learn about budgeting the hard way, because no one sat down and gave us the basics outside of a class at school. But budgeting is crucial for everyone, even if you are not currently worried about having the funds you need. Between emergency situations, market fluctuations, and the changing cost of living, the budget you make today may need a major overhaul in five years. Being prepared will make a big difference.
Since you’re responsible for covering the financial needs of your children until they are grown, it may seem silly to start these conversations so early. But getting your kids used to the idea of being smart with their money is a skill they will use for the rest of their life. Showing your young child why budgeting matters so much will mean they already have a firm grasp of important financial concepts when they are responsible for maintaining their own budget.
Money conversations can feel uncomfortable, but it’s true that practice makes perfect. Use the opportunities life gives you to help your children understand why it’s critical to learn about using their money well, and watch as they take those lessons with them to the next phase of their life.
Nine ways to prevent childcare costs from busting your budget
If you’ve already joined the working parents club, then you completely understand the pain of having childcare costs eating away your budget each month. The hefty price tag of childcare pushes many to delay having children until they feel they can easily afford such responsibility. Before you begin your search for childcare, or if you’re just looking to reduce childcare costs, be sure you know just how much of your budget you can actually afford to allocate to childcare.
Money isn’t the only way to pay for goods and services. Do you have a skill or provide a service that your daycare could use? Simply talk to the director of the daycare to see if you could offer your skills to reduce the costs, or even better, remove the costs altogether. Daycares often hire services for marketing, cleaning, cooking, janitorial, and more. Bartering is still a thing these days, and it relieves the financial burden for both parties involved.
2. Research and compare
First and foremost, research daycares near your home and compare pricing. Think about what’s most important to you, and create a list of questions that can be your guide. Do you want a daycare that’s close to home or one that stays open later than most daycares? While it’s nice to have a low rate, you don’t want to risk your child’s safety or place them in childcare where the teachers are overwhelmed with more children than they can handle.
3. In-home childcare
Businesses exist to generate income, and you can believe that daycares aren’t any different. To take advantage of lower rates, consider an in-home daycare. In-home daycares typically don’t face the same overhead expenses as regular daycare centers that have to hire staff, pay rent, buy food, pay utilities, and buy supplies. If you want to check on the license of an in-home daycare or find valuable childcare resources and tips, visit childcare.gov.
4. Adjust your work schedule
Many employers will work with employees if they need to adjust their work schedules. If your daycare offers part-time or drop-in options, work half the week from home and utilize the daycare the other days. Or, if you want to work nights and weekends, while your partner stays home in the daytime with the children, see if that is available to you. Don’t be afraid to ask for what you want. Many companies aren’t as strict as they were many years ago, appealing to hard-working, young, and thriving parents who are a valuable asset to the company.
5. Work remotely
Telecommuting is a great way to eliminate or reduce childcare costs. Many employers are flexible and understand the need for employees to work remotely occasionally or full-time. Working from home is also beneficial in that it allows you to attend school events, reduce evening stress, save on gas and car repairs, and most off all, allows you to save more money for other day-to-day financial needs. Stay on top of your work responsibilities to ensure your boss doesn’t regret it and suspend your work from home privileges.
6. Government assistance
Yes, childcare is so expensive that the government has stepped in to help parents who struggle to pay the high cost of care each month. While there are certain qualifications that must be met to receive help from the government, it’s a great financial resource worth researching. And don’t assume you exceed the income limits. When you factor in children and the expenses of running a household, many people will be surprised to find out they actually do qualify.
7. Boys & Girls Club or YMCA
Many Boys & Girls Clubs have been around for decades and, just like the YMCA, provide great afterschool hours and very affordable rates. These youth activity centers help students with their homework, engage them with physical and mental activities, provide food, and offer a safe environment for them to work and play.
8. Ask family
Is grandma sitting at home all day watching her favorite court-television shows? Why not ask granny to look after your little one while you work? After all, she’s experienced. Typically, grandmothers love spending time with their grandchildren, or any small children. It may not be the same type of care you’d find at a daycare center, but it’s usually convenient, safe, and affordable. Maybe you have another relative nearby whose schedule isn’t hectic. Family is often supportive of their working family members who have little ones and need to save money. Reach out to your family members and explain the ever-rising costs of daycare and how difficult it is to pay. If they are reluctant, maybe you can pay them something to soften the blow, while helping you to avoid the hefty expense at regular daycares.
9. Try church
Many churches have joined the childcare business, but the best part is their competitive pricing. Most church daycares operate at a 20 percent or greater discount than most private daycare centers. Call around to churches in your neighborhood and inquire about their rates. Once you find one that matches your budget, stop in for a visit. You’ll often find there are fewer children and a very friendly staff. However, more likely than not, there will be some teachings about religion as a part of the church ministry. If you don’t want your child learning about the religion of that church, find one that has similar religious views.
12 terrific ways to teach your kids about money
Educating your child about money and financial responsibility is a big job—and an overwhelming one at that. The lessons they learn early in life will teach them the value of a hard-earned dollar and serve as the foundation for their future spending and savings habits. No pressure there, right?
Money is such a broad topic that it can be incorporated into almost any conversation or daily routine. The trick to corralling your kid’s interest and having them learn a lesson, however, revolves around FUN. Here are some simple, entertaining, and painless ways to start investing in their financial education:
1. Invest in a coin-counting bank
Gone are the days of the pink ceramic piggy bank with the curly tail. We’re going high-tech here. Purchase an automatic coin-counting bank so your child can keep track of how much money they’re saving and spending. It’ll help with addition and subtraction skills, and they’ll love the pride and satisfaction they feel when they can actually see their progress. Next time they have a few dollars or some extra change, they just might decide to choose saving over spending.
2. Stick to a budget
Have your child grab a calculator (or your smartphone) and head to the grocery store together. Before you leave the house, though, set a budget for your shopping trip. As you walk up and down the grocery aisles together and put items in your cart, ask your child to add the cost of each item to your running total, being mindful of your budget. Compare brands and pricing and explain the benefit of buying items on sale.
Let your child see you add their favorite snack to the shopping list if you’re spending less than expected or put an item back on the shelf if you’re getting close to your max budget. Think out loud so they understand your thought process and then eventually ask them to help make similar decisions.
Did you bring your coupons? Ask your child to match them with the appropriate items and then add up all the money you saved. What was the goal and was it more or less than last week?
3. Use coin riddles
One of our favorites is “What’s in your wallet?” Grab a coin purse and a handful of coins. Next, write the clues to different coin combinations on some index cards. For example, I have three coins that equal 40 cents. Which coins are they? Take turns writing the clues and guessing the answers. It’s super easy and can be a spur-of-the-moment activity while waiting in the carpool line, at a restaurant, or in the doctor’s office.
4. Visit your local financial institution
Schedule an afternoon outing to your local bank or credit union. Kids are curious and we’re betting the drive-thru is far less interesting than what’s inside. Schedule a short tour and think about opening a savings account for your child when you’re done. Georgia’s Own’s Coindexter Club® is a great way to start learning about money and interest. An account for a child under the age of 13 can begin with an initial investment as low at $5.00 and will start earning interest at $5.01.
5. Take it online
Given the increasing amount of time kids spend online, games that focus on money and managing finances could make it less mindless, more educational, and just as much fun.
Try Peter Pig’s Money Counter. It’s an interactive game from Visa that teaches counting skills and savings strategies to kids from ages 5-8. Money Metropolis is a game that lets 7-12-year-old kids manage their own virtual bank account, and the Mt. Everest Money Simulation game lets 8-13-year-olds plan an awesome adventure on a budget. For your sport-loving kids who are ages 11 and up, check out Visa’s World Cup-themed soccer game and the Financial Football game, both of which focus on money management.
6. Let ’em earn it
Do you have a child that loves to vacuum or fold the bath towels? Do they watch you mow the lawn or water the plants? Get them involved in age-appropriate chores and give them an allowance so they understand how money is earned. They’ll think it’s fun and you might get a little help around the house.
We know you don’t always get to do the things you enjoy when you’re earning a salary, so toss in a not-so-favorite chore every now and again as they get older. While not as much fun, it’s a good reality check!
Are there other chores that need to be done in the house? Make a list of things that need doing and assign a payment amount to each one. If your child is saving for something special or wants a side hustle to supplement their allowance, they can choose an additional chore and get paid for completing it.
7. Find their entrepreneurial spirit
Is your child a crafter or an artist? Can they make lemonade or bake brownies? There are tons of opportunities to sell things in the neighborhood, supervised, of course. Try setting up shop at the home swim meets, during the neighborhood garage sale, or at the Holiday Craft Show. Discuss the cost of the ingredients and supplies, the price of the items, and how to calculate a profit. If you have an older child, help them design a colorful flyer to drum up some dog sitting, lawn mowing, or mother’s helper opportunities.
8. Make it Family Game Night
Board games are fun activities you can enjoy with the whole family while secretly teaching them about money. Buy some property and build some hotels in Monopoly Jr., go to college and choose a career in The Game of Life, and get to the next month without blowing your entire paycheck in Pay Day. Each one requires wise financial decisions and includes a surprise monkey wrench or two along the way!
9. Create a “great big board of food”
Eating out is expensive for a family, but for special occasions, or when mom or dad has had a long day, it’s always a treat. Designate a wall, board, or even the side of your refrigerator for restaurant coupons. Buy one entrée get the second free, a complimentary appetizer or dessert, or 15% off your total bill goes a long way. Keeping a list of “kids eat free” nights is a great idea, too. If you’re headed out for dinner, ask your child to choose a restaurant from the board and talk about how much you can save with your coupon. As your child gets older, you can even start teaching them about calculating the tip!
10. Teach your gamer how to game
Have a gamer? There’s a huge market for pre-owned video games. Talk to your child about buying certain items new or used and the savings opportunity it can offer. If you’re making the purchase, you might even consider giving your child the amount you saved a time or two as a way to emphasize the impact.
Discuss selling items, like old video games, toys, and electronics as a way to make some extra money and clear out that clutter. Explain to your child that when they sell items that they no longer use, the funds could be reinvested into something else they’ve been swooning over —or they can save it in that nifty coin-counting bank! As the adult, you’ll want to list the items for sale on the resale sites, but have the kids help take pictures, make up descriptions, and set prices.
11. Set out on a hunt
In the spring and summer, there are garage sales every weekend. Give your child a specific dollar amount and let them know they can buy whatever they’d like, but they have to stay within budget. They’ll learn to consider each potential purchase and decide whether it’s worthy enough to spend their cash. They might even decide to save it. As they get older, teach them how to politely negotiate with sellers. After all, haggling is all part of yard sale fun!
For older kids, head to a consignment or thrift shop to find some fantastic deals and incredible prices. Talk about evaluating the condition of the item, quality, and price. They’ll be quick to understand that one man’s discards are another man’s treasure!
12. Pay it forward
Teach your children to be generous. While healthy spending and saving are important, the value of generosity trumps them both. Whether it’s with money, time, or talent, it’s important to give back to the community. You can volunteer together to pack lunches for the homeless, visit a nursing home, or fold clothes at a thrift shop. Whether they bake chocolate chip cookies for a mom with the flu or make an effort to play with the new kid in the neighborhood, cultivating their generous nature will always ensure they have a rich heart!