One of the most important lessons to teach your children is about how to handle their finances.
But teaching them to budget can be difficult, especially if you don’t have enough yourself to provide your children with a regular allowance that would enable them to learn to manage their own money.
Here are five tips to still teach your kids the basics of this necessary life skill without a weekly allowance.
Working for Extra Money
Give your children the opportunity to work for money. This doesn’t mean giving them money for making their bed, cleaning their room, or vacuuming the carpet. These types of chores are things everyone in the family should contribute to, simply by living in the home and being a part of the family.
Find other tasks around the household you can give your children the opportunity to complete, for a set sum of money. Maybe you’d like that shed in the backyard to get the junk cleaned out, but you don’t have the time right now. Or maybe the “lone sock” drawer is overflowing and you need someone to go through and find matches. So long as the task isn’t necessary for the function of your household, it’s something you can give your children the chance to do.
This will allow your children to see how the real world works while they’re very young. It’ll also teach them the value of the dollar. When they realize how much time and money goes into everything, they may become more frugal about their earnings and savings.
Opening Bank Accounts for Them
Purchase a piggy bank for each child, and when it’s full, show them how to open and maintain a savings account. If you open it with them, and have your name on the account as well, you’ll be able to monitor the money that comes and goes through their accounts. Show your children how to get online and track their account as well. These monetary skills will help them throughout their entire lives.
Involving Them with Daily Expenses and Family Budgeting
Have your children help you with your household budgeting. For example, before heading off to the grocery store, let your children know how much money you have for grocery items. Have them make a list of what can be purchased for that amount. Break down the list into food items, personal items, and household maintenance items so they can clearly see where the funds are going.
Giving Them First-Hand Exposure to Handling Money
The next step would be to take them with you to the market so they can help compare pricing and brands to get the best deal possible and stay within budget guidelines. Showing them the sale flyer and demonstrating how to use national, local, and store coupons would also be very beneficial.
Assisting with Major Purchases
It may be a washer and dryer, living room furniture set, or even lawn equipment that is needed for the home. Allow your children to see how much money is available in the budget for this purchase. Give them the leeway to assist in shopping for the item(s) chosen and look for the highest quality with the best price. They can search ads, go online to various websites, or even make phone calls to the venue that carries the item(s).
Advise them that the purchase must stay within the budget guidelines, and even think of extra items that can be added if there is still money left over after everything is purchased. For example, if they find a great deal on a sectional sofa and have a few hundred dollars left, you can use that money to buy a new rug, throw pillows, or even a television set for the same room if the remaining funds allow.
Getting family members involved in household budgeting can be a real eye-opener. It teaches children how to handle available funds and become confident in shopping skills. One of your children may even find such joy in it that they’ll go to school for finance and get an accounting degree. All because of this early introduction to purchasing and budgeting. You don’t need to give an allowance to teach your children about finances and how to handle money. By following the above tips, they’ll be well on their way to becoming financially responsible adults.Tags: allowance, budgeting, parenting