Money, not just a game

Managing Money – Who is teaching this to our kids?

What life lesson is missing in today’s formal education in the school systems?

Is the education and  training, they do receive, reinforced at home?

The 3-R’s are taught and evaluated in the schools, but often overlooked is educating our youth on a skill they will need throughout their lives ~ money management.

Where and when will our kids learn this valuable lifelong skill?

Who is responsible to teach kids to manage money?

When your kids leave home are they prepared to pay and manage their bills?

Are you going to be able to “help” out your kids’ when/if they get in over their heads and their expenses exceed their income?

These are just a few of the many questions to consider when thinking about the life skills of money management.

How often do you go to the store and walk out spending more than you had anticipated?

What if you changed the process around and allocated a portion of that expense to allow your children to share in the responsibility for overseeing their portion of the spending?

Example:

My parents taught me early – about age 12, to begin to manage money.  Our “allowance” was increased to $100 per month.  In the late 70’s, this was a considerable sum for a child to manage.  However, this monthly allocation was intended to cover school lunches, activity fees, clothing and other expenses that my parents would have occurred anyway. At this age, they began the lesson of teaching money management, balancing a check book, and budgeting.

Change the way you handle the incidental expenses

So here is an idea ~ based on your children’s age, level of responsibility and normal expenses you incur, consider teaching your kids to manage an acceptable portion of their expenses ~ begin sharing the values of money management.

This allocation of funds could include a portion of the money the family allocates to charitable contributions.  Explain the values incorporated in giving to charities that you want instilled in your children.

What do you value?

How do you feel this money should be spent based on your core beliefs?

Incorporated these values into the thought processes you teach your kids when addressing the concepts of managing money.

Do you own a small business or complete a Schedule C with your income taxes?  If so, can your children be employed by or serve as a contractor to that entity?

Using various tax strategies, this theory could decrease your tax burden for expenses that would normally be coming out of the household budget

Additionally, think of opportunities for your children to be involved with ways to capitalize on the income and profits of the business with services they contribute to in your organization. Prior to jumping into this strategy, review the concept and the process with your individual tax professional to determine any limitations and other nuisances unique to your specific situation.

Combine money management with contracting skills

In addition to money management, draft a “contract” with your kids for their share of the responsibility and incorporate this into the learning. By adding contracting skills into the money management lessons, these learnings are magnified by giving your children a hands-on education that can be a valuable life skill.

A few ideas to initiate the money management process with your children have been outlined and there are many others. I will be offering a unique learning opportunity later this fall.

More information coming

If you are interested and want to learn more ideas on teaching our youth money management skills, complete the form below to be included in  future updates and receive my free report.

Here is another great blog on kids learning the value of money. http://eco-gites.blogspot.fr/2014/06/helping-11-year-old-understand-value.html

Comments

7 Comments

  • Renae

    Reply Reply 07/24/2014

    Would love to hear the comments you have on this blog.

  • Nelda Choate

    Reply Reply 07/27/2014

    Thank you for this much needed information, Renae. Loved the part about teaching children to donate to charities. I am sending your link on to my daughter for my young grandson.

    • Renae

      Reply Reply 07/28/2014

      Nelda – I love and appreciate the share. I am discovering this is a topic most parents don’t give much thought to and how it will impact our children as they become adults. Leaving home and living independently is tough on our youth and my desire is to make the transition easier on them when “paying the bills” is one less monumental hurdle for them to cross.

  • Great post! It’s so important to teach children the value of money. My parents would “give” me an allowance, which was only a few dollars, and let me work extra to earn more. After I would work my butt off, at the end of the week they would pull out the money, and then make a list of all the bills I “owed” them, and tell me it wasn’t enough. So I never really got any money, no matter how hard I worked. Your idea is way better. 😉
    Amethyst Mahoney recently posted…Top 10 Reasons to Grow Your ListMy Profile

    • Renae

      Reply Reply 07/28/2014

      Thanks so much Amethyst! Every family will need to work through the process to determine what works best for them. I understand the frustrations you experienced in your childhood and hope to make the learnings of money management fun and worthwhile for both the parents and the children.

    • Renae

      Reply Reply 08/05/2014

      🙂 It is great to see how these learnings could benefit our youth of today!

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