Children Learn About Money
Your children's attitude toward money will be shaped by nature. They
inherit from your ideas and you nurture them. They pick up ideas along
the way. Despite peer pressure, it's likely they'll end up the carbon
copy of you. So before you try to mold them, think about picturing yourself
as they see you. Children get a culture on financial life by watching
and listening to their parents and older siblings.
...Must be learned.
The most basic money concept we all deal with are that resources are
scarce. We do not have enough resources to satisfy all our wants and needs.
Therefore, trade-offs and choices must be made. The way that we make these
choices is learned from our families, friends, and personal experiences.
...Must be practiced.
We are all controlled by our habits - both habits that lead to choices
we like and those that do not.
...Includes everyone in the household.
Parents and children need to talk about their needs, wants, and goals.
Family members may have different values. These needs must be shared in
the family. Talk out your concerns, and listen to the needs of others.
After the concerns have been shared, the family makes decisions that reflect
the interests of each family member.
...Is not easy!
Every family has special goals and values, so financial management is
unique to each family.
One way to teach your child about money is an allowance. When is payday?
Children as well as adults want to know. An allowance can give children
a sense of security. It can teach them good skills in using money.
Children, like adults, need the security of a regular income. Some parents
dole out money on an as-needed basis. This may deny their children learning
about saving and spending money.
Most parents are amazed at how much money they give to their children
in small amounts. When parents give money when asked tends to teach children
that money is available in infinite amounts.
The allowance lets children choose how to spend their money. Parents
can help their children in developing good spending habits. Children as
young as age 5 or 6 can learn about money with an allowance. At that time,
set rules on how the allowance can be used. Be sure the child knows these
rules and when he or she will receive the allowance.
If the family budget is limited, parents should still be able to give
allowances. The family allocates money for each family member. Keep records
of how much money is given to each child for school, fun or for toys,
candy, and other wanted items.
When an allowance is given, there should be no strings attached. Do not
withhold money as a punishment for failing to do chores.
Keep the allowances separate from household duties. Children realize
that helping around the house is part of belonging to a family. Children
who are rewarded for doing household chores may never learn the duty involved
in family living.
Also, a child should not be paid for routine behaviors like, brushing
teeth, going to bed on time, or for bringing home good grades in school.
Offer support and praise for a job well done.
Consider that the allowance should teach children how to use money to
make wise decisions. Parents have a responsibility to guide children as
they make decisions. It will help children learn how to save or spend
Prepared by Susan E. Taylor, Consumer
and Family Economics Educator, University of Illinois Extension, Matteson
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