Five ways to teach kids about money
January 20th 2007 04:34
In a previous post (What is the most important thing you can teach your kids), I had mentioned that the most important thing you can teach your kids is not reading, writing or ‘rithmetic .
The most important thing you can teach your kids is to handle money responsibly
Of course, you can’t just tell them to do it (at least for my kids telling them to do something makes them do the opposite) and it is hard for kids to understand and practice just a vague theory of being responsible about money
There is of course no classes in school that teach kids about money
So how do you teach kids about money? In a fun way so that the concepts stick to them for a lifetime without them feeling that they are forced to learn it
Piggybank
You don’t have to spend a lot of dollars and get a fancy one. Just let them decorate and personalize their one jar. You can use it to teach your kids about the value of money -- what it's worth, why you save, and how to save -- and have some creative fun in the process.
Storybooks
There are a lot of times when my kids won’t do it if I tell them to but if they see Barney or SpongeBob doing it they want to be cool and do the same.
Some of my favorite money storybooks for young children include "If You Made a Million" by David M. Schwartz, "Alexander, Who Used to be Rich Last Sunday" by Judith Viorst, "A Dollar for Penny" by Julie Glass and "It's a Habit, Sammy Rabbit!" by Sam Renick.
Read these aloud to your child -- or, if they're old enough, let them read them to you. Kids will enjoy the stories for what they are, and learn something in the process.
Monopoly
This classic board game has sold over 200 million copies worldwide over the past 72 years. This was my favorite game growing up
It can change your life when it comes to money, because you can actually learn lessons from playing it.
The most obvious lesson it teaches is that you can't get rich renting. If you don't own property when you play Monopoly, you lose. Renting makes the player who owns the property rich and, ultimately, the player who doesn't own property poor. A lot like real life.
Other real-life lessons that Monopoly players learn is that it's easier to get rich and win the game by buying less-expensive properties first, because you can build faster and then use the cash flow from these properties to buy the higher-end properties.
There are countless editions of Monopoly available now, which makes it even more fun.
Stock
Teach your child how to "own the place" by opening up a custodial investment account in his or her name. Let your child select companies they have an interest in -- like McDonalds, Nintendo, Disney, and so on -- and with your guidance they can invest in and become owners of these companies.
Another neat way to purchase stock as a gift is through OneShare.com. The actual stock certificate from the company you choose comes beautifully framed and engraved for your little shareholder. When I was small, my parents gave me a share of Disney stock in a gold frame -- I still have it to this day!
Practice what you preach
The best way to reinforce fiscal responsibility is by practicing what you teach them. As a parent you are your kids biggest role model and seeing you live frugally happy will make the lessons stronger
Excerpted in part from The Automatic Millionaire
The most important thing you can teach your kids is to handle money responsibly
Of course, you can’t just tell them to do it (at least for my kids telling them to do something makes them do the opposite) and it is hard for kids to understand and practice just a vague theory of being responsible about money
There is of course no classes in school that teach kids about money
So how do you teach kids about money? In a fun way so that the concepts stick to them for a lifetime without them feeling that they are forced to learn it
Piggybank
You don’t have to spend a lot of dollars and get a fancy one. Just let them decorate and personalize their one jar. You can use it to teach your kids about the value of money -- what it's worth, why you save, and how to save -- and have some creative fun in the process.
Storybooks
There are a lot of times when my kids won’t do it if I tell them to but if they see Barney or SpongeBob doing it they want to be cool and do the same.
Some of my favorite money storybooks for young children include "If You Made a Million" by David M. Schwartz, "Alexander, Who Used to be Rich Last Sunday" by Judith Viorst, "A Dollar for Penny" by Julie Glass and "It's a Habit, Sammy Rabbit!" by Sam Renick.
Read these aloud to your child -- or, if they're old enough, let them read them to you. Kids will enjoy the stories for what they are, and learn something in the process.
Monopoly
This classic board game has sold over 200 million copies worldwide over the past 72 years. This was my favorite game growing up
It can change your life when it comes to money, because you can actually learn lessons from playing it.
The most obvious lesson it teaches is that you can't get rich renting. If you don't own property when you play Monopoly, you lose. Renting makes the player who owns the property rich and, ultimately, the player who doesn't own property poor. A lot like real life.
Other real-life lessons that Monopoly players learn is that it's easier to get rich and win the game by buying less-expensive properties first, because you can build faster and then use the cash flow from these properties to buy the higher-end properties.
There are countless editions of Monopoly available now, which makes it even more fun.
Stock
Teach your child how to "own the place" by opening up a custodial investment account in his or her name. Let your child select companies they have an interest in -- like McDonalds, Nintendo, Disney, and so on -- and with your guidance they can invest in and become owners of these companies.
Another neat way to purchase stock as a gift is through OneShare.com. The actual stock certificate from the company you choose comes beautifully framed and engraved for your little shareholder. When I was small, my parents gave me a share of Disney stock in a gold frame -- I still have it to this day!
Practice what you preach
The best way to reinforce fiscal responsibility is by practicing what you teach them. As a parent you are your kids biggest role model and seeing you live frugally happy will make the lessons stronger
Excerpted in part from The Automatic Millionaire
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Comment by George
this is a wonderful topic...I totally agree. I believe Robert Kiyosaki, the author of "Rich Dad Poor Dad" addresses this in his book as well.
Best Regards,
George
Comment by Manjula
Thanks for stopping by my blog and the book recommendation. I shall definitely put Rich Dad, Poor Dad on my must read list
Regards,
Manjula
Comment by katyzzz
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Good post, as always.
Our kids may not always do as we say, but, at the end of the day, they'll do as we do.
katyzzz
Comment by Manjula
So true - You put it very well in one sentence
Nice seeing you back
Manjula