Teaching kids about money might not be an exciting part of parenting (especially if money is tight), but giving kids tools and knowledge about finances is something every parent should do. In this episode, Susan talks about how she and her husband used allowances, summer jobs, and personal spending to teach their five kids about good money management.
What’s your take on allowance? Did you get one as a kid? Do you pay your kids to work around the house, or do they do chores simply because everyone has to chip in to make a household run? We asked the staff at Family First about allowance. One person said, “In my house, we give allowances when chores or specific tasks are performed, especially to the older one. But we don’t give out cash. We add it to his bank account.” Another said, “My kids get ‘allowance’ in the form of consistent meals.” Two very different takes on allowance!
Another issue parents are up against is that many of us don’t carry cash, and frankly, our kids won’t use it much when they’re adults. But when you’re teaching kids about money, using something tangible is a much better teacher. It also enables them to divide earnings into spending, saving, and sharing.
If you have a child about to get his first job, a game-changing (dare we say life-changing) tip from certified financial planner Dale Alexander is to make 70 your 100. In his book “The Talk” (About Money), Dale advises that instead of spending 100% of what you make, make 70% your 100%. So LIVE on 70%, SAVE 20%, and GIVE 10% away. If your kids can start that habit with their first jobs, they’ll be set up for a healthy financial future and be able to give generously.
We cover a lot more in this episode, like what to do about kids who aren’t motivated by money and how to examine your attitudes about finances that you might be passing down to your kids.
Articles We Mentioned
How Smart Are Your Kids About Money?
Studies Show Why You Need to Start Giving Your Kids an Allowance Today
“The Talk” (About Money) by Dale Alexander
Printables We Think You’ll Like
What are you doing to teach your kids about money?
