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How to Teach Your Kids Life Skills About Money

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As parents there are so many life skills that we need to be teaching our kids. Raising kids is no easy feat, and believe me I know this firsthand since I’ve got nine kids to raise. Some days I feel like I’m doing pretty good while other days I feel like I’m failing miserably. As someone who became debt-free, I am passionate about teaching my own kids how to handle money. But, I am passionate about also teaching other parents how to teach their kids about money. And honestly, as a parent you can’t afford to leave out this basic life skill. More than ever before, kids need to learn about money. And since they’re not learning it in school you have to be the one to teach them.

As the leader of a money saving community, I can say that there are so many parents who feel like they’re not equipped to teach their kids about money because they don’t really know how to handle it themselves. As parents who struggle with money, they honestly have no idea how to teach what they don’t know.

The thing I love about being a parent, is that we have so many opportunities to learn right along with our kids. And if you’re struggling with money as a parent, you can teach your kids these life skills while you are learning and implementing them yourself.

Read on, I’m going to teach you what to teach!

There is much more to learn when I taught this in a class. You can sign up to watch the class by entering your email below!

When it comes to teaching kids about money, it’s important to start at the beginning. Even if you’re great with managing your money, it can be hard to know where to start with your kids. 

Either way, you are going to want to listen up. Your kids are depending on you to teach them these basics.

Teach your kids these basic life skills about how to manage money.

teach kids money

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The beginning starts with teaching your kids the basic truths that we all have come to learn and accept about money. Some of these may seem too basic, but failing to build a strong foundation on these basics is what has brought the average American family into the position they are in now – with more than $16,000 in credit card debt alone!

I don’t want this for my kids. You don’t want this for your kids. And, I don’t want this for your kids either.

And, as you’re teaching these to your kids, make sure you’re fully embracing these for yourselves, too.

Money really does run out

We all have to remind our kids (and maybe ourselves) that money doesn’t grow on trees at some point, don’t we? It really is a natural thing for kids to think that the money is somehow magically there. This is why it is our job as parents to make sure they understand that it doesn’t.

It’s so easy to just not think about the fact that the money isn’t so easily replaced as we’re spending it. But, teaching kids that there will come a time where they can spend themselves right out of money is so important.

Money needs to pay for certain non-negotiables first

Adults often don’t even want to think about this. While we would all like to spend our money only on what we want, basic necessities need to be taken care of first. Everyone needs to pay for things like food and shelter, medical care, and more. And, these things need to be paid for first.

Make sure your kids know that paying for housing, gas to get you to where you need to go, groceries, and other things like this have to come before the things that they want. As much as we don’t want to do things this way, it’s one of those non-negotiable things. 

kids budget

How to make a dollar stretch

If you live with a budget, you are making your dollar stretch. If you buy things when they are on sale at any time, you are stretching your dollar, too. Involving your kids in these processes as is age appropriate means they will be learning the skill of and value found in making every dollar stretch.

As parents we want the best for our kids. We hope for a life free from struggles for our kids. But the reality is that life is hard. And most people do struggle with money at some point in their lives. Learning how to stretch a dollar as a kid will be a life skill that just might keep them afloat someday.

The value of shopping a sale

One year when I was in high school, my mom gave me cash to take to the mall to buy my school clothes. I could by whatever I wanted, but she made it perfectly clear that the money she gave me was the money I had to buy new school clothes for the entire year.

I heard her, but I didn’t really hear her.

Guess what I did?

As you can probably guess, I spent the entire amount of money on two name brand pairs of jeans. I wanted those jeans SO BAD, and once I bought them I felt SO AMAZING.

For about two weeks since it didn’t take me long to realize that aside from those two pairs of jeans, I was wearing all the same stuff I had worn the year before.

And I didn’t like that.

The following year my mom did the same thing.

But, guess what happened that time?

I was so proud to come home with shopping bags full of clothes, and I was even more proud to show my mom what I got. 

I had found some amazing sales, and not one thing was something I paid full price for.

My mom taught me the value of shopping a sale that day.

And I’ve been shopping sales ever since!

The value of repurposing

Another thing that’s important to teach your kids is that sometimes if you don’t end up using something for the purpose you initially intended it for, it doesn’t mean you have to throw it out. Sometimes things work well in a certain area for a time and then stop working well, or at all. But, oftentimes these things can be repurposed to function in a new area or in a new way. 

Throwing something out that is still intact is never a frugal option. Teach your kids to think outside of the box in how they use their stuff.

The value of self discipline

Of course your kids can learn self discipline in other ways, too, but learning it when it comes to spending or not spending money is very real. In helping people with their money for years, a lack of self discipline when it comes to spending money is often to blame for the financial messes that people so often find themselves in.

Spending isn’t bad. But, spending money you don’t have to spend is usually not a good thing. And, if this lesson isn’t learned while they are young, your kids will have to learn it as adults. And in general, the consequences will be more severe at that point as well.

Learning self discipline when it comes to managing money while they are young is so valuable. Self discipline, or a lack thereof, is to blame for so many issues that don’t serve us well. 

It is really awesome when your kids can see you demonstrate this by the way you live your life.

The value in taking proper care of their things

Sometimes kids can think that they can treat their things however they want to, and once whatever it is breaks, they can just replace it. This is almost never true. 

It’s important to teach your kids that if they take care of their things now, their things will last much longer and save them money later.

Accidents happen, but things becoming broken or in bad shape because they aren’t properly maintained is a different story all together.

Learning to be responsible for their things is something your kids learn as they get older. Taking proper steps to take care of their things naturally comes next.

The satisfaction found in saving for something and delayed gratification

Some of the best things you can get are the ones that you had to save for a long time for. Teach your kids that if they save their money now, they’ll have more money to buy something bigger that they’ll want later on down the road.

Similarly, just because your kids can afford something right now doesn’t mean they should have it right now. Looking forward to something is a very powerful thing.

This is so counter-cultural to where we seem to be as a society now. Everything your kids hear screams, “Buy now, pay later,” and this kind of thinking doesn’t do them any favors. 

Because this is the kind of thinking they hear all the time all around them, it is very important for them to hear the opposite from you. Teach them by example the value that is found in waiting for something they want.

The fun of watching savings grow over time

What is more fun than getting your monthly statements from the bank and seeing how much your money has grown? Teach your kids that if they keep putting money in the bank rather than spending it, they’ll get to see it grow!

Let’s be honest for a minute. It’s way more fun to get your paycheck and go spend it on something you want. But it is also really awesome to walk into your house, knowing that you own every square inch of that house. 

teach kids manage money

This is a feeling I know now that my husband and I are debt free.

Similarly, looking at a savings account balance grow from a couple of hundred dollars to a couple of thousand dollars is kinda fun. Watching that balance grow over time is super rewarding. 

Choosing to work extra for extra pay

As adults we might choose to work a second job or to work overtime in order to pay for something we couldn’t otherwise afford. 

In all honesty, when you need more money you only have two choices.

You can reduce your output or increase your income.

Meaning, you can reduce your spending or you can increase your income. And, there is nothing wrong with a little hard work.

When we were building our house, we felt like all we did was spend more money every time we went to our house as they were in the building process.

But, as the building process went along, we paid out of pocket for anything we added on. I was writing personal checks to my builder that were over $10,000 more than once.

How did I do that?

I did that because both my husband and I worked overtime.

We chose to work overtime in order to pay for the extras we wanted.

It should be this way with any “wants” that you are looking at buying. If you want something, then figure out how to get the money before you buy it. 

If available, working for extra pay is a super smart way to do this. 

And such a good lesson for your kids to learn.

My kids always have the option of doing extra work for extra money. When they want something, they usually end up choosing some jobs from the job jar. It’s just a skill that is ingrained within them after all these years.

They know not to come to me and ask me for something they want. They know they can come to me to present me with a plan for how they think they would like to afford something, but they know that in most cases, I’m not just handing over the money for them to spend.

So, they learned to put in extra work whether in my home or outside in the world.

After all, if you want something bad enough, you’re more willing to work hard, aren’t you?

A strong worth ethic is a huge asset that will payoff in spades for your kids when they are adults. So, give them the opportunity to establish that now as a kid. Not only will they work hard, but they will also appreciate what they have all the more because they worked so hard for it in the first place.

Life skills are the responsibility of us as parents to teach our kids. All life skills. We all want our children to succeed in life, and being wise with handling money is a huge asset. 


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