Smart Parents Teach Their Kids These Financial Lessons – Part II

April 1, 2024

Categories: Budgets, Debt Management, Education, Financial Goals, Financial Planning, Financial Security, Kids and Money, Tips, Youth

By Dawn Kellogg

Talking to your child about money does not have to be awkward. This series of blogs will help you navigate through the conversations and make them not only educational, but interactive and fun. Yes, money can be fun!

Lesson #2 – The 3 S’s: Saving, Spending, Sharing

In this article, we’ll talk about what your kids can do with the money that they earn – basically breaking it into the three buckets of saving, spending, and sharing.

It’s so tempting for your kids to want to spend every last cent of their allowance on the newest toy or online game, but it’s important to get them into the habit early of not only spending wisely but saving and sharing as well.

Saving:

Encourage them to deposit 1/3 of their weekly or monthly earnings into their savings account off the top – they won’t be tempted to spend it.

Spending:

Another 1/3 is the money that they have to spend on items they need or want. If they want new bluetooth earbuds, or the coolest basketball sneakers, it will mean more if they have earned and saved the money to purchase these luxury items.

Sharing:

The final 1/3 can be a fun family project. Choose a charity to support as a family. It could be a local food pantry, homeless shelter, or other local organization that supports kids or families. If everyone contributes to that fund, that will add up and can indeed make a difference.  Take your kids to the organization and let them give their money. Then, show them what that organization does with the money. This way, they can understand that their money played a role in making whatever thing that the organization does happen.  This way, you are helping to develop the next generation of philanthropists.

Think about it: you are equipping your children with financial literacy and skills that will help them throughout their entire lives!