Making Children Money Wise

In the difficult times that we’re still living in, one very important responsibility that falls on a parent’s shoulders is the need to help their children learn the importance of money and creating smart spending habits. I know that it sounds very heavy and that your little ones may still be small, but it’s never too early to start building a foundation for a good knowledge base. Whether it’s putting those found pennies away in a piggy bank or taking their birthday money to the bank, we all need to start somewhere. Here are a couple simple tips for building a smart money sense in your child/children.

Start by giving your child/children the ability to earn money/allowance, and then give them the independence to decide how to save and spend that money. At first they will definitely spend above and beyond their means, but as they start to realize that they want a little more to get items more important to them you'll be able to go over saving and putting away for later. It’s also never too soon to start discussing the benefits of putting at least part of their money away towards important expenses, such as a car, a trip, or college.

Have your little one get more involved with your wise money spending decisions right from the jump. Once they've started understanding the concepts of dollars and cents, hand them your wad of coupons. Allow them to help you find the brand that’s on sale, and make sure that it’s still your best buy (over the store brand, for example).

Next, try to help your children understand that everyone needs to compromise when it comes to spending and that even you don't get everything you want (when it comes to purchases). Show how you're making sacrifices for the sake of saving, and then how those sacrifices give you more money to spend at a later date (like with the money saved from the coupons above).

Let your children help you with the budgeting, planning and big decisions when it pertains to them. If you son or daughter has a big birthday coming up (10, 14, etc.) start your planning early and give them a budget and say. If they want to have a “party place” birthday let them explore the pricing and what’s included for different locations. Let them compare and contrast what they would get that way versus a party at home or going to the movies. They'll feel more involved and experience first-hand why you would choose one investment over another.