Teaching your kids how to save money is an invaluable skill that they will have with them for the rest of their lives. After all, you don't want your kids to grow up without any kind of knowledge on how to handle their finances. Fortunately, there are many ways to show them how to do so. If you start them young, then they'll be accustomed to the practice by the time they leave home. The following ideas are the best way to pass fiscal responsibility onto your children.
~The Dream Toy~
If your kids have been coveting an expensive toy or gadget, then tell them they are more than welcome to purchase it - if they buy it themselves! Of course, this might be a little mean, but their birthday and Christmas are pretty far off. If they want the toy now, then they'll just have to save for it. You can even offer to pay for a percentage of the toy if they promise the produce the rest. Create a savings jar to keep track of all their change. Present them with a toy they want, and the rest will work itself out.
~The Trip of a Lifetime~
Your family has booked a vacation to an amazing place such as Disney World, Chicago, Italy, or anywhere else your family is sure to have a blast. Your kids are looking forward to spending tons of money on their souvenirs. However, your plan is to give your kids an X amount of cash. Tell them they can spend it however they want on things such as: snacks, video games, souvenirs, gifts for friends etc. You can even tell them they are more than welcome to save the money for something at home; the decision is theirs.
The only catch is that they won't not get any more money from you on the trip. Of course, you will buy food, excursions, park tickets, and necessities. However, anything like sugary snacks, extra turns on the roller coaster or even a dress will come out of their own stash of money. This way, they learn to budget and save their money. If they blow through their cash early only to whine about it later, then tell them that they should have saved! You can continue to implement this idea on your next trips, and hope that they will have learned their lesson. I like to implement a system where I promise to match whatever they save - that way, their earnings will double!
~Chore Check Sheet~
Kids hate doing chores, but if they have an incentive, it makes things easier. For example, you can keep a tally sheet, and assign chores to dollar amounts. The kids can increase their numbers depending on the chores they do. This is probably the number one way to keep kids focused on a money-saving goal. They can choose to "withdraw" their money at any time, or they can keep track of it in their check sheet. Kids will love to see the number grow, and they'll be able to save for items they want easily without the temptation of having the cash in hand. The best thing about this tactic is that teaches responsibility of many kinds - not just financial.
Joseph Rodriguez writes about all things related to parenting and education. His recent work is about affordable online education degree programs for parents who want to go back to school.