How To Teach Kids To Spend Money Wisely

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Financial education is important. That’s why kids must be taught about money and spending at an early age. Of course, we’re not talking about investments here. As parents, we should focus on the basics first, without forcing it on them, and here’s how you do it.

  1. Be honest

As parents, you have to be honest to your kids. Remember that kids are perceptive. So, tell them the truth about the budget at home. Being open and honest to them about your expenses at home teaches them not only honesty, but also honest spending.

Remember, don’t avoid the money talk. It’s important that your kids learn early about saving and spending. These will help them build their own financial foundation which is a big part of their future.

  1. Teach them

Teach your kids too, regardless if they ask money or not. It’s important to let them know the basics of money. Later on, teach them the importance of both earning and saving money. Remember, teach them both and not just about saving. Because, what will they save if they don’t know where to earn it, right?

Mother and daughter counting money

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  1. Pay in cash

This is for you and your kids, too. Remember, it’s important to teach them how to spend money wisely, and not just how to save money. So, start by avoiding any debt in the process, even if it’s just with your credit card.

Eventually, paying in cash also leads to teaching them how to budget. Make sure that, at an early age, they already know how to prioritize by budgeting their allowances.

  1. More than just their allowance

It’s important that they learn to spend their allowance wisely. But it’ll also be better if they learn to earn more than what you give them.

So, for example, if they work more than what the chores assigned to them, then pay them. Remember, they deserve that extra pay. And it also teaches them to spend their me wisely, too. That’s hitting two birds in one stone, right?

  1. Make it entertaining

Teaching lessons shouldn’t be boring. So, make sure to make your discussions interesting. For example, you can use age-appropriate books, magazines, or videos that teaches about earning, spending, and saving.

money and kids

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  1. Teach them to shop wisely, too

Aside from budgeting, you can also teach your kids to choose the right products or even store appropriate to you or their budget. A simple lesson can be taught by taking them to the mall and letting them choose three pairs of shoes. Don’t look at the price, yet!

So, identify the differences, what they like, and don’t like at the items they chose. Once you’ve completed, look at the price now. Allow them to weigh whether they have to buy the expensive or cheaper one.

Teach them the difference between overpriced items and quality, too. This will help you explain your point better.

So, the next time your kids ask about money, don’t panic. Remember, it’s important for them to learn about money as early as they can.

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