Tips for Teaching Your Children the Value of a Dollar
Besides teaching individual discipline to your children, you should also teach them financial discipline. This skill will come in handy later in life when they are living away from home, or are no longer under your supervision all day long. You may assume that right now they are too young to understand financial issues, but the earlier you start the better. Parents do not need to have dedicated daily money lessons to teach children financial discipline. A good way to teach financial responsibility and the value of money is emulate it in your everyday attitude and actions with money. Make sure to incorporate small routines that will give them the picture of what it takes to earn the money that is given to them, or the money that is spent on them. Most early childhood experts agree that children will assume and reflect the attitudes and assumptions of their parents. The following offers you several ways to introduce a good mindset toward money, and how to teach your child about the value of a dollar.
Explain Why People Go to Work
Young children often do not understand why you have to leave in the morning and return in the evening. Most of them are worried that you do not want to stay home and play with them. It is important to tell them that you have to go to work in order to get the money that you use to buy food and pay for things. When you go outdoors together, explain to them that the workers at the hotel or the people they see at the construction sites are working so that they can get money to take care of their families. Look for these teachable moments to point out adults who are working, and why they do the jobs that they do.
Allow Children to Earn Money to Spend
Give your children jobs to do if they are old enough to assist with smaller household tasks or chores. As a reward for their work, you can offer them a few dollars. Ask them what they intend to buy with their money. This can provide a good opportunity to show how realistic their understanding is of what things cost. Having to purchase something that they really want teaches children about saving and the reward that can come from holding on to money that is earned.
Even very young children are able to understand poverty. Allowing them to see that there are less-fortunate people out there also makes the value of a dollar more tangible. Volunteering and helping out those who are less fortunate not only helps those who benefit from the program, but it also offers your child the chance to ask you about poverty and what creates it. Children who witness altruism at an early age will grow up to also be giving of their time and money.
Let Children Watch You Pay Bills
As you pay the bills each month, have your child assist you. You can write the checks and hand them to your child so that he or she can place them in an envelope, and stick stamps on them for mailing. This way, they will see the impact that rent, cable or other utility bills have on the family resources. Consequently, they will come to understand why it is important to turn off water, appliances and lights that waste valuable resources.
Explain to Your Children About Discounts, Coupons and Sales
Even if you are not good at redeeming coupons, it is important to make your children see the value in them. As you plan for your weekly shopping, teach your children to identify the coupons that will be helpful during the outing. Tell them to clip the coupons and save them in envelopes so that you will use them while shopping. When you go out shopping, let your children locate the products associated with the coupons, and redeem the coupons. Discuss with them how much you have saved by using the coupons. In the same way, if the child is old enough, explain what a discount is, and why it is important to wait for things to go on sale.
Encourage Children to Start Money Jars
A very good way to offer a visual reminder of money and how to be responsible with it, is to create money jars. Each child is given three mason jars, labeled “Spend,” “Save” and “Give.” The money in the “Spend” jar is for children to use as they wish, while the “Save” jar is to save money for some big-ticket item that they want (put a picture of that item on the jar). The “Give” jar is money that they would like to donate to their favorite charity (help them choose one).
Take Advantage of Bank Programs for Children
Many banks offer short weekend programs for kids. These are always age-appropriate and offer fun money games and financially focused discussions. Not only does this make them familiar with the bank and the people who work there, but they also may learn knowledge about money, saving and investing that you may not have felt qualified to discuss.