Try To Raise A Money-Smart Child

The article suggests five ways to teach your children about money:

1. Don't say "We can't afford it"

- Show your child that you are not controlled by your cash flow (or lack thereof)
- Children should understand they have a choice about how to use money
- Teach your child about spending, saving, and making good money choices by giving your child spending money when he/she is as young as 3 (50 cents a week per year of your child's age ($2 a week for a 4-year-old, for instance))
- Help your child develop a simple plan for his allowance


2. Show them the money

- Most children under 7 won't make the connection between the credit card and your ability to pay the bill so use cash for some of the routine purchases when your child's along, and count out those dollahs
- At the same time you need to talk to your children about being smart with credit/debit cards and show them how the money goes poof


3. Talk about how much things cost

- Children should be familiarized with prices and how their mommy and daddy's paychecks are spent
- Don't talk about your child's costing money, as in "Paying for your school clothes made us go over our budget."


4. Buy something that isn't on your list

- Impulse purchases do not make you a bad parent (Whew! I make them all the time.)
- You should explain to your child that the impulse purchase was purchased with the money set aside to freely spend with
- Your child should see the flexibility and enjoyment when you spend what you've earned "because being smart about money doesn't just mean knowing how to budget and save -- it also means being able to spend wisely."


5. Be open with your spouse

- Hidden purchases from their partners? Spend too much? No!
- It's not good for children to see distrust and/or secrecy between parents
- Moms tend to make purchases of clothes and activities for the children and dads may not know how expensive they can be...Got that right.

Okay, now I'm a little perturbed that I spent too much dollahs on stuff this past weekend although it wasn't an impulse purchase. Gonna have to make me a budget. Sigh...