Kids & Money (Part I)
At this point, you know I’m passionate about educating adults on finance. What you may not know is that I’m equally passionate about teaching children about money. Since you have some long, sweltering summer days ahead of you, why not be intentional in taking your kids’ knowledge to the next level when it comes to money? I am a firm believer that the way we think about and the habits we form regarding money should start very early. If we want those thoughts and habits to be good ones, we have to lay some groundwork for our children. Here’s what I recommend:
“Show Me the Money!”
Your kids must have access to money in order to learn how to effectively handle it. I was once teaching a class to parents on how to talk to your kids about money, and I was surprised to find that there wasn’t even one parent in the class who was giving their child access to money! How can you learn to use something you don’t even have? So this is step 1: you must give your child money or let your child earn money. I’m a fan of the latter, but I’ll get to that in a minute.
The other aspect of this point is that you want to physically give your child access to money. We used to put our kids’ money away for safe keeping, but they often asked for it. They really liked sitting down on the living room floor, feeling the money in their hands, and counting it out. So my advice is to make it physically available to them, even if they are at an age that requires supervision with it. You want them to get comfortable handling money, and have plenty of time to practice counting it. Your child’s teacher will thank you for the extra math practice next year.
“How Do I Get Money?”
I think it's important to connect money to work. In our house, we believe that everyone has some jobs that they do in contribution to the family. Mom and Dad don’t get paid for those, and neither do the kids. However, I do believe that we need to give our kids opportunities, beyond the expected chores, to earn money. If you don’t connect having money to earning it, you may end up with an adult child who has unreasonable expectations and entitlement issues.
HERE is a handy list of age-appropriate jobs for children aged 2-18 if you’d like some ideas. Keep in mind that your child may be above or below their age range on the chart, so be sure to look in the “neighboring” age ranges for extra ideas.
Giving the kids a visual representation of what work they can do and how much money each job will pay is a great idea. It could be as simple as a list or as visual as actual money showing them how much they can earn with each completed job.
Encourage Good Work Ethic
Regarding the work they do to earn money, I would encourage you to hold your child’s work to a good standard, but don’t be a perfectionist. You want quality work - to their age and ability - but you don’t want to be overly critical and discouraging. Remember to be extra patient as you are teaching your child how to do his or her new jobs. Be positive and encouraging to keep them motivated.
So, Mom or Dad, here’s your homework: come up with some jobs that your child can do to earn some money in the next couple of weeks. It will be easiest, especially with young children, if you pay them $1 for their chores. But don’t pay them with dollar bills; pay them with dimes. That will make it much easier when you start calculating percentages in the coming weeks when I post about what to do once your child has earned some money.
As always, I’d love to hear from you, especially if you have any great tips to share in regards to how you help your children earn and handle money at your house. Otherwise, stay tuned for my next blog post!
Click HERE to read the next post in this series, Kids & Money Part II.