Monday, October 23, 2006

Tips For Teaching Children About Money

Charles Surgeon once said, "Economy is half the battle of life. It is not so difficult to make money as it is to spend it wisely."

My friend, Gina Bassman, who created and runs her own home business -- Gonicofish.com -- shared eight tips with me for teaching young children about money. She and her husband, Robert, who runs his own CPA firm, are using these with their six-year-old son, Nico. They consider Nico to be their miracle child, as it was difficult for them to have a child.

At any rate, here are the things Gina suggests:

1) Open a savings account with your child at the bank. Physically take him to the bank regularly so that he can make small deposits. Talk about his savings passbook with him. Praise huim as the balance grows.
2) Give your child a small allowance in increments that he can easily divide. That way, he will be able to use some now and save some for later.
3) Help your child save for a particular item on his or her wish list. Give him an envelope labeled with the name or picture of the object. Let him put small amounts of money in. When the envelope contains enough money, take him on a fun shopping trip to purchase the item.
4) Begin early to teach children the amounts of coins and the denominations of bills. Most children can mast this during their pre-school years.
5) Before taking your child grocery shopping with you, talk to him beforehand about what will occur on the trip. If you plan to allow him a treat or a toy, set a price limit. At the store, help him
to choose an item within that dollar amount. If you start your shopping trip with this limit in mind, it will teach the child how to have self-control when confronted with all of the colorful displays in the store. It will also make the trip smoother and easier for you. At any rate, be sure not to give in if your child whines for everything that he or she sees. You will be doing your child a favor in the long run.
6) When letting your child have a treat, give him the money and have him hand it to the cashier instead of just tacking the cost on to your own purchases. In that way, he will learn the concept that whenever you bring home an item, a cost is involed.
7) Play matching games with the faces on dollar bills and counting games with coins. Make it fun.

And....drum roll for number eight...sure to be a favorite with moms who strive for frugality and simplicity in their home lives -- Gina says it's never to early to teach a child how to comparison shop! Now, there's a mom after my heart!

8) "The Internet is a great way for teaching children how to find the best price and value for an item," she says. The other night, she helped Nico shop on the Internet for a toy harmonica. She says he enjoyed looking at all of the pictures. She let him hunt and peck for the keys and reports -- with no bias, of course -- the "he looked adorable" as he searched for te right keys. She says it was a wonderful way to spend fun time doing something that he enjoyed, plus he learned about value, price, and computer skills in the process.

Enjoy!
elizabeth

2 comments:

Wendy WaterBirde said...

Really good ideas : )
Frugality really wasnt taught much it seems to my generation--and now I find myself making up for lost time. How wonderful for folks to understand this earlier...

Elizabeth said...

Hi Wendy,

I agree. The earlier the better.:)

Elizabeth