Youth & Money
Teach Your Kids How To Make Money
Many kids know their parents go to work, but really have little idea of what it takes to make money. Learning how to start and run a business may be one of the most important lessons, financial or otherwise, they can learn. They can learn math, marketing, communications, responsibility and a variety of other skills. Even if your offspring end up working in jobs for someone else, they'll be better employees because they understand the challenges involved in having a business.
If your children are old enough to earn money on their own - usually by age 7 or 8 -- help them research business ideas that appeal to them. Assist them as they learn about marketing, keeping track of income and expenses, and following up with customers. Just don't do it all for them! Let them learn what owning a business is really like.
To get started==> Visit your local library for a copy of books like 101 Marvelous Money-Making Ideas For Kids by Heather Wood, Fast Cash For Kids by Bonnie and Noel Drew or The Young Entrepreneur's Guide to Starting and Running a Business by Steve Mariotti.
Go With the Flow: Parents often find that their kids have their own money "personalities." No matter what you try to teach them, one child may be a spender while another is a saver, for example. While it may be frustrating a times, you'll have more success if you recognize their personalities and try to work with them. A child who is a spender, for example, may need you to dole out her allowance over several days during the week, rather than all at once. Or, if she's older, you might need to open a bank account where she can park her money without easy access to it.
If you have a saver who can't bear to part with a penny, you might instruct him to give a small percentage to a good cause of his choice, or let him have more decisions over purchases he must make, like school clothes and supplies.
Teach Your Kids to Be Resourceful. Your kids may be more willing to help you stretch the family dollar than you realize. Challenge them with helping the family save money - and offer an inexpensive reward. Depending on their age they may help you come up with ideas for cheap meals, be willing to visit the local library instead of the video store for DVD's and CD's, or ferret out places for free recreation. Most kids like the idea of pitching in to help the family, as long as they feel their contributions are valued. Give them the chance.
Help Them Set Goals. Research by Consumer Federation of America and Bank of America has found that adults with a written financial have twice as much in savings and investments as those without written goals - and that includes families with small incomes. Starting this at a young age can help make goal-setting second nature.
Encourage your child to write down what they want, and depending on their age, help them figure out what it will take (allowance, extra income, gifts, etc.) to get there. A colorful chart can make it easy to track their progress as they go along. Celebrate with a special meal or outing when they successfully reach a goal!
Keeping written records of what they've saved, spent and earned can also be helpful for your kids. Not only will it help them better manage their money, it will also help with their math skills!
Limit Television: Watching a lot of television exposes children to a lot of commercials. In turn, they often want what they see. Consider limiting television, and also talking with them about the commercials they see to help them learn how to distinguish between hype and reality.
A good resource for understanding advertising tricks of the trade is the Consumer Reports children's magazine Zillions. Although it's no longer published, you can view all back issues at www.zillions.org. Especially fun is the section "food ad tricks" that shows how food is "made up" for advertising. Vaseline on hamburgers is just one example you'll find there!
