21 November 2011

Teaching Your Kids Safe Spending Habits

Teaching kids money management skills early on can lay a foundation for success later in life.  One way to start the learning early on is to teach your children how to save their money, how to make it grow, and of course, how to spend it wisely!  Also be sure to include the differences between needs, wants, and wishes.  This helps them to determine if saving or spending in particular situations is the best choice.

Setting goals with children when it comes to their money is another great way to lay the foundation for good money management skills.  One way you can do this is by taking a high ticket item your child has their heart set on.  Encourage the idea of saving towards this goal.  You can even help your child with this goal by stating that you will contribute "x" amount of dollars once they have reached the goal of a particular set amount of money saved.

If your child gets an allowance, it is recommended to give them this in amounts that promote the skills of saving verses spending.  You can do this by giving them five one dollar bills instead of a five dollar bill.  Doing it this way will allow the child to put part of their allowance away for saving, while keeping a portion for spending.

It also doesn't hurt to include your child, especially as they get older into teens, how much the household bills actually cost.  This gives your child an inside look at how much it costs to run a home, and how saving helps to afford the luxuries your family enjoys indulging in when possible.  For teens, this could be a wonderful opportunity to let them see exactly how credit cards work, and how interest is calculated.  This helps promote future wise decisions in borrowing money.

Prepaid debit cards are a wonderful way to continue money management skills as your children get older.  Allowing them to hold their finances on a prepaid debit card for wise spending will enforce the value of a dollar. The My Green Dot prepaid debit card is a great first card just for this purpose!  My Green Dot has the ability to be used as normal debit and credit card functioning, and can be purchased through  nationwide retailers as temporary one time re-loadable or through ordering a personalized card that has the re-loadable feature.  These types of cards can be used to load allowance, paychecks, and more.  This is also a great way to teach responsibility as a whole.

Check out this website for games that help teach your children about money!

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