How To Teach Kids the Value of Earning Money
Have you noticed how kids these days seem to think money literally grows on trees? I once heard of a kid who thought his parents had an unlimited money supply and that they could write out checks for any amount they wanted! It’s normal to want the best for your kids, especially if you had a hard life and didn’t have money for the things you wanted as a kid. But the thing is, we’re not doing our kids any favors by coddling them and taking care of their every need.
Kids will fare much better in life if they’re taught at a young age the value of working hard to earn their own money. They’ll be better prepared to enter the workforce, and they’ll have a better work ethic than their peers who never had to work a day in their lives. Here are a few easy ways to start teaching your kids the value of earning money.
Set Up a Multi-Jar Financial System
When your kids first start earning money for doing chores, taking care of the pets, or walking the neighbor’s dogs, set up a multi-jar financial system. One jar should be clearly labeled “earnings,” while another jar should be labeled “savings.” You can also set up multiple jars for specific things, such as “charitable giving,” “Dollhouse,” or anything else they want to save their money to buy.
You can also open a bank account for your kids, but I recommend the jar method because it’s easy to see earnings grow through a clear glass jar. When your child is old enough to have a real job, she can open a bank account and will already have the basic tools needed to manage money.
Show Them That Things Cost Money
If your child consistently asks you to buy him toys, candy or other unnecessary items every time you go to the store, it’s time to teach him that things cost money. You can do this by telling your child he can bring some of his earnings to the store and pick out a toy or other item he wants to buy.
Once he sees how much money it really costs to purchase various things, he’ll (hopefully) be more appreciative of you efforts to support him financially. Have him take care of the entire purchasing process, including handing his money over to the cashier. This will give him valuable experience and will teach him the value of his money.
Avoid Impulse Buys
Remember, everything little Sally knows about money she learns from you. Teach her how important it is to think purchases through carefully before buying. Don’t ever impulse buy, or your daughter will likely follow in your shoes and think that impulse money management is normal.
Instead of giving in to your child’s impulse buy requests (or your own!) stop and take a minute to think. Is the item really necessary? If it’s not, let your child know she can buy it using her own hard-earned money. Encourage her to think about it for at least a day before making a decision. That way, she’ll have time to decide if the item is really worth her money or not.
Teach Good Work Ethic
These days, too many entitled people expect to receive more than they give. There are countless get-rich-schemes out there that cheapen the value of money and encourage greed. You can help your child avoid these pitfalls of the modern world by teaching good work ethic. Help him understand that working hard is about more than earning money. It’s also about feeling proud of what you’ve accomplished and being content with what you have.
Good money habits aren’t developed overnight. That’s why it’s important to teach children the value of earning money while they’re still young. These tips will help you raise a posterity that knows how to work hard and make an honest living.