teaching money skills

[pennywise]

What do you think is the best way to teach children, or anyone, about money? How can you teach the value of money - does money grow on trees?

I have taken my daughter to the computer and shown her the interest on the mortgage on the amortization schedule. I show her the interest she earns on CDs, bonds, and her stocks, yet she says she is not interested. She is 10.

She had a friend go to sign up with her recommendation at gymnastics and she was entitled to a $10 referral. She said she would not go for it "because we could afford pizza"? I got it. How can we get her and others to understand?

[CJsoccerchic]

Re: teaching money skills

How often do you take her shopping? Or better yet, does she often ask you to take her shopping for things that she may not need at the time but would like (ex. she has 10 pairs of jeans, but really wants a new pair) do you make her work for it (chores?) or do you go get it for her? That could be a good way to teach her the value of money. Make her work hard for the 11th pair.

[Fern]

Re: teaching money skills

I guess she couldn't relate to the interest on the mortgage because she has no invovlement in making your mortgage payments. Pizza, and most dinners, i imagine, are always taken care of by her parents, so that, too, is not compelling to her.

What really matters to her, in terms of material possessions? The lastest CD from her favorite group, that new pair of jeans, a new bike? How, ordinarily, does she get these things? I agree with previous responder, you can't teach the value of money if she never has to work for something she wants.

[Ima saver]

Re: teaching money skills

I had the same problem, and no matter how hard I tried nothing worked. I had savings acounts, made her save her allowance, her baby sitting money, then she got a job. I tried everything and she just did not care about any of that stuff.
Today is she mid thirties, does not have dime one, doesn't work and borrows from everyone. (except me, anymore) I have given up on her!!

[cicy33]

Re: teaching money skills

We stopped buying the kids stuff. We started paying a $2 a week allowance (they are 7,8, 9 and 10) and the deal was they have to help out and be good or they lose that too! Since we started doing that they have started to understand that they are paying for their stuff. We actually make them do it too! you can't say it and then say oh, it is okay I will make up the dollar. NO WAY. You have to say you have $10 saved up and that is it. tax included. When our 9 year old wants to go skating and it is not a family event we make her pay for it herself. She bought some stuff at walmart last week and did not like that her allowance that she had saved had dropped so much. But it is the only way to teach them by making them be the payer not you just constantly saying this cost this and this saves that. They have no concept yet.

[Ima saver]

Re: teaching money skills

Yes, I think giving an allowance and making them pay for their own stuff is a good way to start.

[Lemony]

Re: teaching money skills

Our kids are quite young (4, 3, 2) but we're trying to start them early. they understand that treats cost money, that leaving the fridge open and running water waste money and that Mummy & Daddy work so that we can afford a good life.

We've also taught them that others aren't as fortunate as us. We frequently go through old toys and clothes (usually before birthdays and holidays) and the kids each pick out items they would like to give to needy families. It's a great way to declutter!

[nanamom]

Re: teaching money skills

I had a senior high class do a project one year where they had to budget for a year including all bills, food, fun, etc. I had some new "catastrophe" happen each month to unbalance their budget and I set up credit card accounts with the school store for them at a major interest rate as well as insisted on savings and checking accounts also through the store. Every week they had to check all the sales and make a grocery list etc. It was an eye opener for all of them. I remember one very sweet intelligent girl going nuts in my office because I had just handed her a bill to have her garbage picked up. She thought it just happened. One month we planned a funeral and they were shocked. It was very educational for all of them and I hope helped as they went into the world. I would have preferred to do it earlier in their school career but that was when I got them. If the school doesn't do it there is no reason why a parent can't.

[PrincessPerky]

Re: teaching money skills

Reverse that, the school most likely can't! so please do it!

I often explain to my kids that DH makes a set amount of money (give or take) so if they want the money to go to steak, or trips to the discovery place (science center) they shouldn't leave the lights on or fridge open that will drive the electric bill up. When they are older I want to actually show them the budget, including all the bills splurges and mortgage.

I do not currently do an allowance, and may never. because my kids get more discrecionary cash from the ILs than we have! so my buck that I could afford wouldn't be a drop in the hat! but we do make sure the savings account is untouchable (and added to by them) and that if they want something we think about the cost, figure out how to make the money/how long to wait for money then we get it. DS is right now looking to get a computer game. he knows he needs money, but he got a 5$ gift card for build a bear in the mail (birthday promo) he wanted to use it for the game, doesn't quite work that way! But it was cute

Who pays for those dance classes? if she doesn't und3rstand where that comes from, the cost of the class wont mean much to her.