Becoming familiar with budgets, both personal and household isn’t easy for children. Some parents try to push the budget explanations because they feel it’s important for their kids to learn but often find themselves floundering when they don’t get a good response from the kids.
There are some tricks and tips you can follow that will help to teach your little ones about the world of budgets. There are plenty of activities available that can be adapted for children of all ages.
It’s never too young to start teaching your child about money and finances, but it’s also important not to overwhelm them with too much information at once. Budgeting is a great way to teach your children about saving and spending money. It can also serve as an easy introduction to the world of finance for those who find the idea overwhelming.
1. Piggybank family – This activity may be best suited for younger children. Split your child’s piggy bank into two piles, “Family” and “Me.” Fill the family side one quarter to one-half full with change, then fill the other side with your own money. Make a point to talk to your child about what you are doing. You can even discuss how much he or she is worth about the other family members.
2. Make a budget for your household. Make a list of what you typically buy every month. Divide the items up into categories like food, health and beauty products, utilities, rent/mortgage, and so on. Have your child add up how much each category costs per month and then total it at the end.
3. Make budgeting fun by letting your child choose something he or she wants to buy (a toy, clothes, etc.) and then drawing up a budget for it. You can do the same thing with more expensive purchases like vacations or cars.
4. Eating out is often an expense that gets overlooked when budgeting. Ask your children how much they think dinner at a restaurant cost per person including taxes and tips. Then take them to eat and show them the bill at the end of the meal. Have them calculate how much money they would have to save up if they were going to eat there once a week for the next year.
5. When you’re doing your monthly budget, make sure your children understand that it’s necessary to set aside some money for emergencies too. Talk about what that might mean.
6. Parents often only give their children an allowance if they are doing chores around the house, but it can be a great learning opportunity to have your child earn some spending money just for being part of the family too. Don’t forget to include any extra costs for this spending in your budget though.
7. It can be interesting to sit down with your children and add up how much money they have spent so far today. Children might not understand when you tell them that $25 in an afternoon is a lot of money, but they need to learn the value of a dollar at some point.