If you’ve got a child or teen, you know that most kids want to spend their money the second they get it. Today I’m sharing 5 tips to teach money management to kids that will help your kids be more responsible, teach them to save, and how to make the most of their money.
5 Tips to Teach Money Management to Kids
Every time your child gets money, have them save a certain percentage.
College, a car, and living expenses are very expensive, so it’s a great habit for your teen to start saving money every time they earn money. Decide on a percentage of their money to save, and stick with it. 50% is a great goal!
Not only will your teen be learning how to budget and save their money, but they’ll also have a nice chunk of money when it’s time to go to college, buy that car, or make that next big purchase.
Teach your kids how to shop wisely.
Teach your kids how to shop the sales, use online coupon codes, printable coupons, special deals, rewards cards, and more when making a purchase so they can save more of their hard-earned money. Weekly grocery ads, clothing sales, and more are all teaching opportunities so your child can learn to spend wisely and stretch their dollars.
Open up a savings account and debit card for your teen.
With a savings account, your teen will now have somewhere safe to put their money they’re saving (and not be tempted to spend it).
I recently learned about Greenlight, the smart debit card for kids. It’s a debit card that is for kids ages 8-18 that’s designed to teach money management. Greenlight allows kids to spend their own money, while parents can control where the money is spent and how much they can spend in certain types of stores. Both parent and child will receive an alert when any purchase is made using the debit card, so you’re always in the know.
Parents download the app (available for iOS and Android) and can manage their’ child’s accounts from their phone. Talk about convenient!
Greenlight costs just $4.99 per month, which includes cards for up to 5 children. Parents can transfer money into their child’s accounts with no fees. You can try out the card for 30 days to see if it’s a good fit for your family. Sign up for Greenlight before 10/30 and they’ll deposit a $20 bonus into your account after the 30-day free trial ends. *deposit bonus made approximately two weeks after free trial ends.
Give your kids an allowance.
Giving your child a weekly or monthly allowance is a great way for them to start learning to budget their money. When they have more responsibility and things that they need to buy, they will quickly and more easily be able to distinguish their wants from their needs.
Parents who give their children allowances have the option of setting up an automatic allowance payment once with the Greenlight debit card, and then not worrying about it again, all without any extra fees!
Make your kids work for the extras.
My kids are constantly asking me for things, many of which are “impulse buys” that they really don’t need. My husband and I say no to most of their requests so they can learn that they don’t get whatever they want whenever they want.
However, our kids do have the option of doing extra jobs and work around the house if there is something that they really want to buy. I’ve found that if it’s important enough to them, then they will do the work and save for it. If it’s something they just wanted me to buy, they usually don’t take me up on the offer to work for it. 😉
I hope these tips to teach money management to kids get you thinking about things that you can do as a parent to encourage your child to be responsible with their money. It’s a great lesson to earn at an early age, and one that will affect them for the rest of their lives.