Teaching Children about Money: Ten Principles

Money and KidsBy David John Marotta

As Americans try to spend less and go on a budget, this provides an opportunity to teach the next generation financial principles they may never have seen in the prosperous years they have been alive. Here are ten principles for teaching children about money:

Talk about money. Every time money is involved, parents have a chance to teach their children the values and analysis behind their actions. Money should never be the primarily topic of discussion, but it is one of the most important topics through which we communicate our wisdom and values to our children. Every purchase, investment, or donation can be a time to teach your children something about your values.

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9 Responses to Teaching Children about Money: Ten Principles

  1. Minimum Wage says:

    I just tried out the millionaire calculator and came up with an inspiring result, which is even more inspiring after reading this post.

    If a parent invests $30 per month ($1 per day) at 8 percent for their child starting the day the child is born, and the child takes over at the point they are able to earn money for optional jobs, if they maintain this $30 per month pace, the child will ultimately have a cool million in about 814 months (68 years).

    Now THAT is a retirement plan I can relate to.

  2. And you would expect one of the top ten principles to deal with saving – but, no. Lots about spending but nary a hint about saving.

    It seems paying a fee for finacial advice does not require the advisor to have judgment – just knowledge. Proof again that folks who take on the mantle of financial planning and write about money often are so bound up with conventional wisdom that they overlook common sense.

  3. Stacy says:

    I think these are good ideas. It is good to be open (to a point) about money with kids. I especially like the part that was added about making kids wait to make large purchases.

  4. Parker T says:

    Great write up.

    Tony

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  6. Pingback: 8 Ways to Raise a Thankful Child | Preschool Education & Everything Preschool

  7. Gina Wadding says:

    I have two comments, where can I put a dollar a day away and get 8% return?

    with my children I sometimes let them help me with the bill paying I let them put the checks in the envelopes and put the stamps on them then check pd on my Budget chart for that month. I answer all there questions and help them to understand that everything costs money. We even got to pay for the water that is used when we flush the toilet.

  8. awdata says:

    Savings relies on having more income than expenses. For children, I recommend an allowance with a component that they can spend as they want, and one for some of their “regular” candy/toy/clothing purchases. Then for savings, let them build short term and long term savings, where they can raid the short term savings for certain jointly approved purchases.

  9. me+gary says:

    Our children must EARN their allowance, no freebies!! As a single parent that was *less* than good with money throughout my youth, teaching children about money is CRUCIAL, in my mind. I

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