blog question of the week
Date: Mon, 05/19/2008 - 19:02
Hi, I tried to post the following entry to the question of the week and it came back with an error message, yet added my name to the list. please let me know if it was inserted properly, or if i need to do so again.
I think one of the best ways to teach kids money management is by creating a systematic allowance system which mimics real life economy.
For example, I think think it is very important that the allowance is "earned" by doing chores/special projects, etc. This way, they are learning that you have to work for your money (it doesn't just appear out of thin air). Also important is that allowance money is needed. I intend to pay for for all essentials of my child, but to budget extras such as "special toys", gifts for family members, treats from the icecream truck, etc. in their allowance money. This way, from a very young age they will be used to budgeting their money. If I pay for every special treat my child wants, their money will not mean much to them. I would much rather pay my child a generous allowance (based on work ethic) and have them make financial mistakes as kids instead of as adults.
Another important part of their allowance includes a mandatory budget. I had a friend growing up who received allowance every week. Each week 10% of her earnings went to church, 10% went to savings and the rest she could spend however she wished. Imagine practicing putting 10% of your income in the bank since you are 5 or 6 years old.
I also intend to teach my children about money by recycling toys. If my child wants a brand new toy, I will tell him/her that I will buy it for them if they will give to charity an old toy they no longer use. I will also take them to garage sales, thrift shops, etc. and emphasize how fun it is and what treasures we have found. Instead of throwing something old out, I will try to make a game as to how we can use it for something else?
Lastly, I will model for my childen how to maintain a budget and be honest with them as they grow up about my financial problems early on. When I see someone who is homeless or if we volunteer at a shelter, I will take the time to explain to them how sometimes good people mess up with their money and it takes some time for them to get back on their feet.
*I also plan to educate them on investing (as soon as I learn more myself.
*As they enter college and get a car, etc. I plan to put their name on my credit card and to teach them how to use credit for one central thing (such as gas) and pay it off each month. Their name being on my card will also allow them to start life with a high credit score and several years of credit history.
I think one of the best ways to teach kids money management is by creating a systematic allowance system which mimics real life economy.
For example, I think think it is very important that the allowance is "earned" by doing chores/special projects, etc. This way, they are learning that you have to work for your money (it doesn't just appear out of thin air). Also important is that allowance money is needed. I intend to pay for for all essentials of my child, but to budget extras such as "special toys", gifts for family members, treats from the icecream truck, etc. in their allowance money. This way, from a very young age they will be used to budgeting their money. If I pay for every special treat my child wants, their money will not mean much to them. I would much rather pay my child a generous allowance (based on work ethic) and have them make financial mistakes as kids instead of as adults.
Another important part of their allowance includes a mandatory budget. I had a friend growing up who received allowance every week. Each week 10% of her earnings went to church, 10% went to savings and the rest she could spend however she wished. Imagine practicing putting 10% of your income in the bank since you are 5 or 6 years old.
I also intend to teach my children about money by recycling toys. If my child wants a brand new toy, I will tell him/her that I will buy it for them if they will give to charity an old toy they no longer use. I will also take them to garage sales, thrift shops, etc. and emphasize how fun it is and what treasures we have found. Instead of throwing something old out, I will try to make a game as to how we can use it for something else?
Lastly, I will model for my childen how to maintain a budget and be honest with them as they grow up about my financial problems early on. When I see someone who is homeless or if we volunteer at a shelter, I will take the time to explain to them how sometimes good people mess up with their money and it takes some time for them to get back on their feet.
*I also plan to educate them on investing (as soon as I learn more myself.
*As they enter college and get a car, etc. I plan to put their name on my credit card and to teach them how to use credit for one central thing (such as gas) and pay it off each month. Their name being on my card will also allow them to start life with a high credit score and several years of credit history.
luv2laugh- please contact Jason and he can tell you if if went t
luv2laugh- please contact Jason and he can tell you if if went through.karen
