Amazing Kids! Magazine

Activities to Make your Family “Money Smart”

By Sean Traynor, Editorial Advisor

 

Many times in a family the parents take care of all the money issues and the children are not involved at all. This situation makes it very difficult to be smart about money when the child goes out on his or her own or when they want to save and buy a big-ticket item.  Here are some activities that you can do as a family so that everyone learns how to be “Money Smart.”

  1.  Set up a family change jar to save for a family treat.  You can discuss what the treat will be as a family and all work together to save small change for these things.  Make it a double treat by making the reward be a family outing where you can be together experiencing something fun.
  2. Parents should consider giving an allowance to kids.  Kids that have money of their own understand the value of money and how saving can help get better things.  The added bonus is that the kids will stop begging for money or treats because they can be in control of purchasing it from their allowance.
  3. Have both kids and parents share spending decisions.  If there is a big ticket item needed for the family (a house, car, appliance), have everyone in the family give their input as to what is important to them.  Share the cost of the item with everyone and how the family needs to plan and save or perhaps borrow money to make the purchase.  Seeing the bigger picture of family purchases will help kids understand a little more about money.  This is a great teaching opportunity for the parents to show the kids how a budget works.  Have the family set up a list of priorities of purchases.  In that way, the kids won’t mind having to give up a special camp or a new phone if they know something bigger will be the reward later on.
  4. Parents can use each shopping trip as a way to teach kids about proper spending techniques.  If the parents have a conversation about their thinking about purchases at the store, the kids will learn a lot about purchase techniques.  For instance, at the grocery store the parent can talk about buying a name brand product versus a generic brand.  They can also talk about buying in bulk rather than small one-serving packages and the price advantages there.
  5. Everyone in the family should learn about banks, lending and saving.  There are some fun family games that will give opportunities to teach about these things.  Monopoly and Life are both classic board games that teach about savings and investing.  You can also pretend to invest in the stock market and keep track of your money and how it changes.  Parents can help with this.  You can also set up a pretend or real checking account where your allowance will be put and you can watch your savings grow.  Set up a savings account and make deposits regularly.  This can be a fun activity to do with the entire family.  Go over the bank statements and get excited about your money.
  6. Learn how Automated Teller Machines (ATMs) work.  It is important to know that the money must be in the account before it is withdrawn from the machine.  The machine just doesn’t spit out money from nowhere.
  7. Do real earning activities.  Set up a lemonade stand or garage sale and be involved in setting prices.  Learn about the cost of things in order to determine the sales price so you make money.  At garage sales you can learn about bargaining and quantity sales.
  8. Kids can practice borrowing money by borrowing some money from parents to purchase an item.  Work together to set out a payment plan.  The parents should charge interest on the borrowed amount so the kids get a feeling about the cost of borrowing money.  The result will be that kids will find out it is better to save for purchases because borrowing money can be expensive, making it longer to pay off the loan.

Learning about money can be fun!  Make it a family activity and everyone can be “Money Smart.”  Working together will allow everyone to enjoy purchases more and make more intelligent purchases.  Kids will be able to be on their own at a much younger age as they learn by example the good lessons from the family.