Managing money is one of the greatest skills parents can teach children and encouraging good spending habits at an early age will save your child lifelong angst.
1. Bring your child to work with you to explain where your money comes from and how you
earn it
2. Teach kids the difference between needs and wants. Explain that you have both too, and
how you make decisions about purchases.
3. Deposit your children’s money into an account to teach them how to manage it.
4. Allow your child to keep his or her own money. It should be the child’s job to keep it safe.
5. If your child wants to borrow money to purchase holiday gifts, consider it a lesson in loans.
Charge a bit of interest, and he or she will understand that it is better to spend what you
have than to borrow.
6. As your child gets older, gradually increase the amount of purchases for which she or he is
accountable.
7. Share with your children the importance of giving. It is the greatest gift you can give yourself.
Involve them in your charitable donations this holiday season. Encourage them to donate
some of their own money. There are many reputable sites to learn of quality organizations.
8. Let children make (small) mistakes with their money so they learn the consequences of poor
money management.
9. Monitor your child’s spending habits so you can provide real-time, real-world guidance.
10. Take advantage of new tools available to help your children and family learn financial
literacy. Obopay is an excellent one - it is mobile phone based and almost all children are
already comfortable with mobile phones.
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