Help Your Kids Learn More About Managing Their Personal Economy

Remember when cash was a tangible commodity in all of our personal economies? As kids, we went to the bank, shopped with our parents and frequently watched them pay with cash. Now with cash on the endangered species list, today's kids see their personal economic situation much differently. As we enjoy the convenience of charge cards, stored value cards, debit cards and ATM cards, the challenge of teaching kids about an invisible commodity like money is magnified. If you're searching for ways to teach your kids more about what makes up their personal economy, including the importance of saving and how to set and reach their financial goals, here are some practical tips.

Give kids an allowance - If you give your child an allowance, try tying their allowance to responsibilities like feeding pets, taking out trash or cleaning their rooms. Of course, the level of responsibility and the amount of the allowance should be tied to the children's ages and abilities, and your own financial means.

Help kids build up their personal economy by establishing savings goals - Work with your kids to create a list of why they should save and things they want to save for ? big and small ? then help them prioritize it. Ask them to put three stars next to the things they want most, two stars next to the things they would like and one star next to those that are least important. Have them categorize the items as most expensive to least expensive. You can help them use these ratings to choose what they want to save for by focusing on the three-star items they want most and determining how much they think they can save.

Help kids find a place to keep their savings - It's a good idea to keep savings and spending money separate - perhaps in labeled containers. By attaching a picture of that "something special" to their savings container, kids can keep their goal visible. They could use different colored wallets for savings and for spending money or ask if they would like to open a savings account at your bank while keeping spending money at home.

Help kids track their progress. Let's face it, kids find saving boring (honestly, so do a lot of adults). You can help build and maintain the excitement of reaching a personal economic goal by making a savings thermometer and coloring in the sections as money is saved. Post your child's progress charts in visible places and celebrate their progress. It's important to make saving money fun and rewarding with many celebrations along the way.

Encourage kids to avoid spur-of-the-moment spending. While most kids have good intentions for their savings goals, their plans are often derailed by impulse purchases - like that hot new toy. Here is some advice you can give your kids to keep them from getting off-course:

  • Leave money behind - Bring only a small amount of money on shopping trips to help avoid impulse purchases.

  • Don't forget about your savings goal - Carry a picture of what you are saving for and compare it to anything you are tempted to buy.

  • Be a bargain hunter - Wait for the item you want to go on sale and watch for coupons.

  • Don't rush into purchases - Avoid buying anything you see for at least two weeks. Add it to your "wants" list and then prioritize it against the other things you want.

  • Ask for help in securing money - Parents can help keep your savings in a safe place if you think you will be tempted to spend it.

Once your kids establish a saving pattern you'll find they take great pride in striving for and reaching their financial goals. You might even consider matching their savings after they prove they are serious about putting away an agreed upon amount. As with anything else in life, your children will find determination and patience are rewarded, and the payoff for reaching their personal economic goals is worth the challenge of getting there.

About The Author

Sandra N. Salter specializes in business and personal finance issues and she is also the owner of American Express Financial Advisors Branch Office in New Jersey. She focuses on providing comprehensive financial planning services paying close attention to the long-term financial health of their clients, building customized financial plans that help clients achieve both short-term and long-term goals. The types of services she offers clients include: Income Tax Planning, Saving and Investing for Retirement, Working with Retirees, Financial Strategies for Small Business, Domestic Partner Planning, Risk Protection Planning, Estate Planning, Charitable Giving , Investment Strategies for Education , Asset Allocation and Comprehensive Financial Planning, among other areas. They can be reached at [email protected].

In The News:

Parenting  Khaleej Times
Dark Parenting Styles  Psychology Today
Parenting in a pandemic  Bangkok Post
Letter to the editor: Do a little parenting  The Bakersfield Californian
Body-positive parenting | Off the Record  Chico Enterprise-Record

Parent Involvement: Finding Your Way in Middle School and High School

In elementary school it's pretty straightforward: bringing in cupcakes to... Read More

The Laid Back Parents Guide to Teaching Your Child to Read

At first I thought of titling this article "The Lazy... Read More

Mommie Moments ? Taking Time For Yourself

Being a parent is a role that requires a large... Read More

Why Creativity and Self-Expression are Important to Little Kids

Can you draw a straight line? Most adults don't consider... Read More

Teaching Problem Solving Skills to Children with ADHD

Even though the "Stop and Think" movement in ADHD treatment... Read More

How Public Schools Lie to Parents and Betray Our Children

Under the "No Child Left Behind Act," public schools whose... Read More

The Real Problem With Todays Teenagers (And Why Most Parents Just Dont Get It!)

An address given by Rev. David B. Smith... Read More

Homeschooling ? Is It Worth It?

Suppose that you rearrange your life to homeschool your child... Read More

Parenting Your Teenager: How to Say NO!

Q: Whenever we tell my daughter "no," she just bugs... Read More

What Julia Roberts has to Say about Motherhood

Julia Roberts recently gave birth to twins: Hazel and Phinnaeus.... Read More

Sometimes Our Childrens Questions Answer Our Own

I was changing Ford's diaper the other day when he... Read More

Children Need Roots and Wings

"Good parents give their children Roots and Wings." --Jonas SalkThe... Read More

10 Steps To Prepare You For Life With Children

It's hard to explain to the uninitiated the changes that... Read More

First Year With Twins - A Father?s Point Of View

People always ask my wife and I: "How did you... Read More

The Homeopathic Nutraceutical Attend as an Alternative to Ritalin

You no longer have to use Ritalin or other stimulants... Read More

Diagnosing ADHD in Your Child, an Introduction

Everyone in a private practice setting who works with children... Read More

The Added Advantage In African American Childrens Education: Computer Homeschooling (Part 2)

We've got spirit, yes we do! We've got spirit how... Read More

COMMITMENT: Teaching Children the Lessons of a Lifetime

It's been said, time and again, that for a child... Read More

Raise Awesome Kids! This 4-Point Plan Gets Results

Are your children truthful, kind, and helpful? If so, read... Read More

Twelve Tips To Connect With Teachers At Conference Time

It's that time again! Parent-teacher conferences are coming. Are you... Read More

Legacy to Your Children

John Bishop's Goal Setting for Students.comLegacy to Your ChildrenIt's 6:30... Read More

Attaboy! Encouraging Phrases That Build Confidence

Home, home on the range, Where never is heard A... Read More

Parenting Your Teenager: 4 Dangerous Myths

MYTH: All teens have to rebel, and the teen years... Read More

Remember The Generation Gap?

The techniques of managing relationships between parents and their children... Read More

How Public Schools Assault Parents Values

Is there anything wrong with lying, cheating, stealing, shop-lifting, taking... Read More