Money makes the world go around… or so the world would have us believe. I’m not buying it (sorry about the pun), but I do know that money is an important thing to know how to use wisely.
Introducing our kids to the concept of money is something that can happen organically in the early days and in a more structured way as the kids get older. It’s an important thing to think about even when your kids are very young – they learn more than you think by the way you treat money yourself.
Lots children confess to being stressed out about their parents’ money situation and that’s not good for anyone. On the flip side,lots of kids think the ATM gives you as much money as you wantand that’s not good either.
Money is a fact of life
So, the first step for any family is to look at the way money is discussed around the children and what they are learning as a result. Talk to them about your job and what getting paid means and what tax is and why it’s important. Talk about the kinds of jobs they might like in the future to earn their own money. You can introduce the idea of working hard to buy the things you want, but try not to talk about personal money issues or stress – a child will find it hard to understand why you don’t have enough even though you work really hard or why some people have lots and others very little. Actually, I still don’t understand those concepts myself…
Money buys things
We are all so used to paying with our credit or savings cards that we often forget to take along some actual cash for our children to be responsible for. Money is a tangible thing that comes and goes, a credit card looks exactly the same before and after the transaction. Try to pay cash for at least a couple of things a week so your child can be the one to ‘pay the lady’. Let them hand over the money and accept the change and receipts. Count the money out for them both times, letting them know that the cashier has kept some money for the items you’ve just purchased. Don’t let them keep the change… they need to work to get money, it is only rarely gifted.
Money is precious
To bring the value of money home, it’s important not to let the kids use real money as a toy. They should really only handle money when they receive their pocket money or maybe when they get a bonus from the tooth fairy. Try not to leave coins lying around the house (if you’re anything like me, you may need to speak to the man of the house about that!). The more kids see money abandoned here and there, the lower its value becomes. Money is precious and should be taken great care of.
You have to work to get money
If you’re tempted to just give your kids a set amount of money each week without making them work for it, resist temptation. At a certain age (only you will know the right age for your child), kids need to start working for the things they want. Of course, you’ll still take care of everything they need without getting them to sweep a floor, but if it’s a want, well, here’s the broom. There are lots of reasons why we want to do this, all of them cliches:
- Money doesn’t grow on trees
- There’s no such thing as a free lunch
- Life doesn’t owe you a living
You can’t always get what you want
Well, this is one that I struggle with myself and probably always will. No, you can’t have it now, you have to save towards it. This has been a stop-start value at our place – a few weeks of intense saving towards something big then the guilty purchase of something not-so-big. I leave this to the children’s discretion, and this includes whether they save a portion each week or not – it’s their money and they’re in charge. I confess that my eight-year-old son still thinks he is buying a Nintendo DSi at the end of the year with his whole $24 pocket money he’s managed to save this whole year… so, like I said, I am definitely no expert in this area. My dilemma right now is that since he’s saved $24 towards the $200 device do I fund the remainder or not? I’m thinking that Santa might cough up for the device and then Max can use his savings to buy the game of his choice. Santa is handy like that.
Short-cut to good citizens
Responsibility, work ethic, earning rewards, independence, goal setting… getting kids to work for what they want is like a short-cut to helping them become good citizens. Better yet, it’s like a short-cut to good parenting. You can add to this effect by making sure they always set aside a little of their money to give to a charity that they choose. It doesn’t have to be a lot. At our place, the kids get about $2 a week and give 20c each towards our Plan Australia sponsorship of Kingston, a boy from Malawi. They take great pride in using their own money to contribute towards a good life for Kingston and, as you can imagine, in return Kingston has taught them what a good life actually is…
Do you do pocket money at your place?
There are loads of systems for setting up pocket money. Here are a few more ideas and articles to get you started.
Before you even get started on dolling out the pocket money, it’s important that your child learns the value of money. Many families start with a ‘points system’ and introduce money later. Click through to read some great advice about how to teach your child the value of a dollar. Image: Thinkstock.
Some kids find it hard to work towards a monetary reward at the end of the week. For a system with a little more ‘instant gratification’ attached to it, check out the chore system devised by Erica from the blog Confessions of a Home Schooler. She offers all of the cards and tokens as a free printable for you to try out yourself.
Starting an official savings account for your child is a good way to motivate them to save at least some of the pocket money they earn. If your school doesn’t support school banking, you can contact your own bank or credit union to find out what they offer. Click through for more advice on helping your child start saving. Image: Thinkstock.
The Pocket Money Blues by Sally Rippin is a cute story about a girl called Billie who is trying to save up for a special toy, only to have her plans sabotaged by her next door neighbour Jack. This is a good book to encourage kids to save for ‘special things’ rather than spend all their pocket money at once!