Teaching your children about money

I distinctly remember my French teacher telling me not to say "Je veux, je veux, je veux" in France. Rather, I should say "Je voudrais." She likened "Je veux, je veux, je veux" to a child saying "I want, I want, I want." Je voudrais, meaning I would like, is much more polite. The whole "I want, I want, I want" stuck with me. Now, with my own child, I do hear plenty of "I want, I want, I want." Of course, this is typical of a child. However, my husband and I want her to be cognizant of the cost of things. We have not done anything exciting, just some basic things to help her learn about money. I think that it has worked well. While we do still hear "I want, I want, I want" a bit, we also hear "I don't have money for this right now," "I will buy this with my money" and "I will save money for this."

Here are some of the methods that we use:

1.) Earning: My daughter has an allowance that she must earn through chores. If she does not complete her chores or misbehaves, she gets no allowance. She has had an allowance since about 5-years-old.



2.) Learning: She receives an odd amount of money from the tooth fairy and must count it accurately or she cannot keep it. Since she is older, I think we are going to add something like a math problem that she needs to solve in order to keep the money.

3.) Waiting: We do not purchase frivolous items for our daughter for a couple of months leading up to a gift giving holiday. For example, in November, we do not buy her any little treats and let her know that she needs to wait to see what she receives for Christmas. Now, she even says, "I really want this. But, I need to wait to see what I get for Christmas."Sometimes, things sink in!

4.) Saving: My daughter has a savings account that she actively puts money in herself. She loves to deposit money that she has earned herself or received as a gift into the bank. She also likes to watch the amount grow.

5.) Setting goals: Whenever my daughter wants something frivolous that I am unwilling to purchase, we research the price so that she has an earnings goal. This often happens when she receives the American Girl catalog! She was able to purchase a Wii with her own money by putting together birthday money and gift cards.

6.) Budgeting: My daughter has a cute little piggy bank that has sections for savings, spending, charity and investing. While she is not ready for investing yet, she does understand the other three sections. When she has charity collections at school, she actually goes into her own bank for the money. (We are talking like $1 or so here, but she gets the point.)

7.) Giving: We have never hidden from my daughter that there are people who have less than us. She understands the importance of giving to those that may have less than us. She actively helps us gather items for a local animal shelter. Now, if I only could get her to donate more toys.......

8.) Couponing: I have mentioned before that my husband is a couponer. He is not over the top, but he knows how to get a deal. My daughter likes to sit with my husband after a shopping trip and learn about the deals. She also scans stores for deals, which is pretty cute!

I am pretty proud of how my daughter has been handling money. Often when she wants something, she presents us with a plan using her own money--not that we don't buy her treats here and there. However, she does not ask for too much and often will find a way to finance it on her own. We do have blips here and there when she gets a little greedy. For the most part, though, she does not ask for too much and really thinks about a purchase. Hopefully, these skills will stay with her!

How about you? Do you have any methods to help children learn about managing money?