You know what they say; money makes the world go round! It’s an interesting thing when kids get to the age where they realize the importance of money in their lives and what money can get for them. Depending of how well you are off financially and how you were raised teaching kids about money can be a very different experience and often difficult to know the lines of how much is too much and how little is too little. Should your kids be made to get by with the bare minimum? Or should they be indulged and not have to think about the troublesome thing money can be? In my opinion teaching kids the value of the dollar is a worthwhile exercise. When kids learn the value of money and that it does not just grow on trees to be handed to them whenever they want something, they learn to respect it a lot more. Likewise when it is opened up to kids that they have an opportunity to make their own money they learn to treasure it and you will often find they are can be great savers, saving their coins up for that perfect thing. So teaching kids how they can make their own money, how to save it and how to spend it can help them in their future and in budgeting as adults also.
How To Make Money
Showing kids ways they can make their own money instead of just asking for a handout every time they want something, or not daring to ask and going without that special something they’ve had their eye on, can be an extremely liberating thing for them. Learning how earn by exchanging goods or services for money as a kid can lead to entrepreneurial adults.
The first and most simple step to helping kids earn is the ‘pocket money’ system. This can work a few ways; it can be a set amount each week a child receives for having helped around the home or it can be small amounts of money per job they do, the more they do the more they can earn.
Starting in the home is a safe place for kids to test out their new money making abilities. You can write a list of all the chores you want done, now this can be a different list from the regular chores they do as part of their contribution to the house, and you can put a price on each chore, the kids can tick off a chore once they have done it and collect their money when the whole list is complete or as they go, depending on what works best for them and you.
Be careful when you do set your prices on home hold and garden chores that you are not setting them too high or too low. Too low and kids will soon loose interest as their goal of saving enough seems unachievable. Set it too high and they are not really learning how you need to work hard for your money. Once you have come up with your prices stick with them. As the kids grow older and their tasks become harder, then change the prices to suit.
Supporting kids to run their own small businesses is a great way to teach them how to make and save money and a range of other skills. Running a little business can teach them people skills, how to handle money and customer service it can also help them get better at a hobby and is a great after school and weekend activity hat will keep their inventive brains working and best of all it’s fun!!
Small business for kids don’t have to be an intense production. It can be little one off lemonade stalls, or an in season orange stall that they may pick from your backyard and sell them. Some projects can be ongoing ones however. So if your child is interested in making some extra money, go through with them what they are good at, the skills they have and how they could turn any of them into a way to make money. If you kid loves animals but doesn’t have a pet they may like to start a dog walking service. You could help them print out fliers or go door to door with them while they ask the neighbors.
Or if your child is very crafty they could consider making their crafts and selling them. This could be between family and friends or if there is a certain quality about their products you could help them set up a stall at some local markets.
The important thing with helping a kid with their small business is giving them confidence while helping them maintain some grounding. If some of their ideas are a bit far fetched or out of reach financially or ever skill wise, it’s important not to shut them down and tell them it’s a bad idea, but more help then think of ways they could make the idea a little simpler and more in reach. That way they will be able to achieve their goals without getting downhearted when a huge idea doesn’t work.
If these ideas so far aren’t quite the right fit for your child you could consider perhaps helping them acquire a paper round or pamphlet run or even ask any friends or neighbors if there is any regular jobs they need done. It could be that a neighbor wants their lawn mowed once a week or help with some house hold tasks at a regular time. This can be great with kids with a busy schedule that prefer to have everything pre planned for their week so they know when they can fit their ‘work’ time in.
How To Save Money
Now they have their money, the next step is to save! Now some kids will want to save big for that one toy or game they have been dreaming of, they will be willing to not spend any of their hard earned cash until they have enough for it but other kids the minute they get a dollar they are down to the store to buy candy! Showing kids what they can achieve with there money can be a useful tool in helping them save further. If your child does not have a specific goal in mind, sit with them and talk about the things they want, it may not even be a thing it could be a particular outing to a theme park or an exhibition. Go through with them how much what ever they want will cost and break it down. For example you could say, well if you do X amount chores a week for X amount of weeks, then you will have enough to buy this. Breaking it down will help kids understand how much work is needed to get what they want, and if they want it sooner they will work harder.
If it’s a bigger item your child is saving for, something they have their heart set on but would take them years to save for you may also consider meeting them part of the way with money. If you can see a child is saving so hard but it will take them a long time to get what they are after you may suggest that when they have raised a certain amount of money then you will pay the rest. This will encourage them to keep working and saving and not having them loose heart when what they want seems out of their reach.
How To Spend Money
Teaching kids how to spend their money is also a very important part. Some kids will want to buy junk with their hard-earned cash cheap toys or sweets. You can show kids how to budget and save some of their money for those little immediate things and then the rest for more important items. Teaching kids how much things are worth is also worthwhile, tell them that while something may be cheaper so they could buy them quicker the quality may not be as good so the chances are they will not work as well as they want or will break sooner and they will get to enjoy them for a shorter time. If kids are buying the things they really desire that are good quality with their own money they will build more of a respect for those items and in general for things, understanding the hard work it took to get certain things. Once they have their items it’s important to show them how to care for them properly, if for example they buy a skateboard, leaving it out in the yard at night will damage it. Show them they need to respect it by putting it away in its correct place. The same goes for sports equipment or electronics. How much care they treat an item with will determine its lifespan.
Life Time Skills
By teaching kids the importance of working for their money you are teaching them to understand how work equates to money, which equates to the things they get to enjoy. This can show them to have more respect for their own possessions and for you as parents by making them realize that no, money doesn’t grow on trees and you too have to work hard to provide for them. Kids that are taught these skills young will find it easier in the future as they grow and have to start budgeting while in collage and even when getting their first jobs and having to support themselves. They will know how to save and what is worth spending their money on.