Let’s talk about kids and money. At one point or another, most parents find themselves saying, “What? Do you think money grows on trees?” It may be an automatic response, but it’s still a good one. Kids need to learn the difference between needs and wants, and that’s the on-ramp.
Kids + Money
As a roadmap, I’ve put together a list of things to consider:
- Treat allowance like a job — as opposed to just a weekly hand out. Making it part of a transaction gets them thinking about saving, and soon enough they’re vested in it.
- Encourage kids to be entrepreneurs, like running a lemonade stand or selling cookies. Even if it’s something that they’re doing for charity, it should be encouraged because it’s the right sort of mentality to build in a young person.
- Be very transparent with your kids. Talk to them about how different jobs have different pay — and that not everybody earns the same, and there is disparity in the world. You can throw in how you do things because you love them, but not everyone has a parent as great as you.
- Teach them to be savvy spenders and deal-makers. Teach them not to accept every offer. Personally, I bring my kids to tag sales and flea markets, and they see me negotiating. I also negotiate my monthly bills, so they see it in more important real-life settings.
- Teach them the value of sales. As much as they want things that are very expensive, it’s often best to delay gratification and see if they go on sale. They’re just as good on sale. In fact, better.
Making your kid aware of money is the opening salvo in a lifelong relationship. Soon you’ll be able to transition your child to the idea of saving for the future — and with that, a whole new set of lessons to teach. And if you can’t, Judith Heft & Associates can be your child’s Money Mentor. For more information, contact us.