Teaching your kids about money.

Last spring, my 12 year old came to me to discuss how he could make a little extra cash.

At first we talked about the usual chores: yard, pets, cleaning.

But then we started to talk about how he could help me track the family finances and budget. He loves math and has a head for numbers. Plus he’s come of age during the online school of COVID, so he felt really comfortable with computer work and navigating the software. I’ve had a personal Quickbooks account for a few years, but I am terrible at the upkeep (cobbler’s kid has no shoes and all that).  So, I set him up with his own login and trained him on the basics and just like that, my son became our household bookkeeper.

This exercise is giving him some new skills and it also opens up opportunities for conversations around bigger issues like budgets, saving, cost of living, etc. After he finishes the monthly books, I review everything and make some adjustments and then we run reports to see how our spending tracked for the month compared to previous. We talk about why one area might be higher than normal or where we did a good job of cutting costs. It also jumpstarts conversations around the cost of high ticket items that we have to integrate like travel for his taekwondo or concerts we want to see. It's been a good tool to teach skills that will help him as he becomes a young adult. 

Another tool I’ve used is a Greenlight debit card for each of my kids, allowing them the opportunity for hands-on learning about saving, spending and investing. My son allocates a set amount of his bi-weekly allowance to investing and enjoys buying and selling and researching the options. He uses his spending money for his video games and when he wants to make extra cash or finishes his bookkeeping, his pay goes right on his card.

My 16 year old has a very different spending ethos. She is not interested in investing and will sometimes save for a sweet new pair of Nikes, but is more likely to spend her bi-weekly allowance on snacks with friends or trinkets from Rockin Rudy’s. As she has become a driver in the last year, it has also allowed me to delegate grocery runs, restocking her toiletries or refueling the car by putting money on her card for those errands. It's a huge help and she is getting hands-on lessons in the cost of things and navigating those grown-up processes. 

Meeting with clients who, as fully-fledged adults, still struggle with finances, has put a spotlight on the importance of integrating financial literacy into my everyday life as a parent. Honestly, I still struggle with some of the concepts (hello investing, what a strange shadowy creature you are), so I am learning along with them sometimes. This month, we will tackle a variety of topics surrounding finances and the young people in our lives. Let us know your own tips and tricks as well as your questions!

Fast Facts:

79% of parents give their kids an allowance, and MOST of those require their kids to “earn” it by doing chores

31% of parents do not discuss money AT ALL