How do we teach our children to create their own budget?
We all want our children to be educated, literate, have great numeracy skills and be well behaved, don’t we? That is an aspiration of all parents and caregivers, and we will do our best to make that happen. But how do we teach our children to use and save money? What can we do to support them from an early age to understand how our monetary world works?
Well, that is not a simple task, especially if we were never taught these skills and still don’t know how to wisely use our own hard-earned money.
It is very important to develop good habits in our children’s lives and if we start early, these good habits will have more chances to last.
A good way to start teaching our children about money is taking them with us when we go shopping. I know it is not easy! I remember taking my daughter along to the grocery store and having to explain to her why we are not buying chocolate, pop and potato chips, regardless of the tantrums. But, fellow parents, I can attest that this task is worth it. One thing that can make your life a lot easier is to ask your child to help you write the grocery list before you leave the house. This way they will know what you are planning to buy. You can even mention how much money you want to spend that day at the grocery store.
As soon as you get to the store and begin placing things in your shopping cart, ask your child if they know how much that product costs. When you have a few things in the cart, you can also ask your child, depending on age, for an “estimation” of the total grocery bill. This is a great exercise that will help your child think about expenses and also to plan for a real budget. Including children in the family’s financial planning will empower them to make better future monetary decisions.
Another strategy that helps children deal with money is to give them an allowance as a teaching tool; to allow them to develop some independence skills rather than just paying them for chores. It can be something really small, once a week or even once a month, as the lesson we want to teach is how to use or save that money. The actual amount is up to each family to decide, and it can be adjusted accordingly to the child’s age.
The main point is that children should learn how to plan to save money in order to acquire something they really want to buy. It also helps them to understand why sometimes they cannot afford to buy something that they wish to have.
Be your child’s best financial advisor. Teaching children how to budget with small amounts of money can save them a lot of ‘headaches’ in the future when they will be dealing with larger amounts. Allowing your children to be part of your financial lives from a young age will help them have better control of their own future financial situation.
Claudia Sasse is a mom, teacher and graduate student working on her master’s degree in elementary education, focused on curriculum and pedagogy. Born in Brazil, Sasse has lived in Airdrie with her husband and daughter since 2009.