Money Management Life Skills For Your Kids

Do your kids know how to manage their own money? It is often very difficult to explain why money does not grow on trees and why as parents we can’t buy them everything they want. 

If your children are earning an allowance or have money given to them, begin as early as you can with the process of teaching them how to manage their own money. Start a special bank book that has the date, time, a green column (for what goes in), and a red column (for what comes out).  Use it for every transaction that occurs. Total it up for every entry.  If it's an online account, perhaps keep a manual book by the computer so you can scribble down  a record that's quickly visible for them, as your child won't have online access to his or her account.

It’s always fun to use real money to learn with as they put their math skills to work in counting and understanding how many dimes are in a loony etc…

Now that they understand how to make change, and can calculate their very own balance sheet, they may be up for running their own garage sale. This will de-clutter your home, give value to their belongings, teach them how to be environmentaly friendly, and how to learn people skills in working well with others while giving back to their community.

Keep these tips in mind when for initiating a yard sale:

Perhaps get a two-page receipt book to let them record every transaction so that they can keep track of what was sold and for how much. That will also help them to calculate and add up multiple purchases.

Let your children choose what they want to put in their garage sale. It’s best if you place everything into a pile on the floor and have them decide what they really love and what they can part with. You will then have two separate piles. Rationalize with them in learning what they really haven’t used in a year—from books to clothing. Help them price things realistically.

Recycling and being green is a fun way for your kids to see first hand the concept of repurposing and reusing old stuff.  Just because they no longer play with something or don’t wear it anymore does not mean it’s trash.  Anything left over can always be donated to Goodwill so that someone else can make use of it.

The garage sale is a great way to teach communication skills. They will have a chance to practice “good manners” to their benefit.  The experience from setting up, making decisions, cooperating with others and counting up the sales at the end of the day will give them a sense of pride and confidence.  

Consider donating a portion of the sales to a charitable organization and naming it “Yard Sale For The Cure”, for example. In doing so, you’ll give your kids the power to help others—and show them how great it feels to do so. 

After helping them manage their money, your kids will learn the value of their possessions, as well as the concept of giving back to the community, while making a little profit.

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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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