Money Management for Kids

Enabling your child to work with money will build a foundation for managing money through their teens and into adulthood. When your child asks for something, they will choose to put some thought into it if they are using their own money. They will start to understand the value of money, and the fact that it does not grow on trees. It is never too late to start an allowance concept with your child, but it is recommended that the concept is taught during Kinder Garden years. If you want the “I wanna have” to stop; this system will work and it does make shopping less stressful for both you and your children.

Starting an allowance for the start of the School Year is a great idea. Starting an allowance is often a difficult thing to create when you have to figure out what is acceptable for both parent and child, and in putting an amount to what is fair - all the while making sure it fits with into the home budget as well. Clearly detailing what is normally expected in School and at home is a good place to start, then you can go from there in acknowledging what they want and a clear achievable way for them to obtain their goal in working towards it.

Take a poll of your child's friends and other families you know asking what range and scope they're using with their child. This will ensure you are familiar with the comparison’s your child will make once you have started up an allowance. In the early years sticker charts and favourite foods are a great means to reward good work and achieved goals. Moving forward there will always be requests for more. How you both learn from this situation will leave them with great negotiating skills for future raises at work.

Starting a savings account is also a great idea once they get a little older, and helping them choose how to manage it is one of the best qualities you can help them cultivate. Even the act of going to the bank and opening up an account (take a look at the transaction fees and your homework prior) is reward enough in making that first deposit. You may wish to match their contribution depending on what the account is set up for. If the purpose of the account is to be used only for larger purchase items they need to save up for, then at least the details of how it is used is predetermined.

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