Wondering how you can keep the kids learning during the dog days of summer? In addition to summer reading and all the other fun activities you have planned to occupy their time, perhaps it’s time to incorporate the subject of personal finance.
What Is Money?
If you haven’t started the conversation yet, summer is a great time to get kids thinking about the value of a dollar. Everyday activities are perfect teachable moments:
- Before going to the grocery store, have your child help you clip out coupons and create a list and show them how it helps to save money on food. Teach your children about price comparison and value as you pick up each item.
- Next time you visit the ATM teach your child that money doesn’t actually come from a machine, you have to earn it. Show them the importance of hiding the pin number to avoid identity theft.
- Next time you are opening bills take the time to talk about payment for services, credit card debt and interest rates. Children need to be taught about debt, specifically loans and credit cards.
What Costs Money?
Children see the exchange but may find it difficult to attribute the value of life’s necessities. Start with small change to help them grasp the idea of quantity. If they’re a bit older, break down equivalencies (ex: 2 nickles make 1 dime). Using every day instances will help them understand how money is spent:
- Go on a “money tour” around the house. Help kids understand what kinds of elements goes into making the house function. Use utilities as an example: explain that hot water costs more than cold water, a great segue into conserving energy to save money and the environment.
- Stage a yard sale. Go around the house and help them price out various furniture, decor or kitchenware. Discuss what you paid for it and the depreciation of items after they are used.
- Pile up all of the bills for the month and have them look at the amount on each one. Have them help you check for any errors. This reiterates the cost of living and the importance of being financially responsible.
This is just a start to help your family become financially literate, skills that will help aid in making their financial future a success. Stay tuned for more of the summer school edition of Teaching Kids About Money.
For the technology savvy family, here are some great videos for kids to explain money and how it works.
To speak to a credit counselor today about budgeting and managing your finances, call 800-769-3571.