Marshfield Medical Center Credit Union > Financial Literacy > Teaching Your Kids About Spending
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Last week, we shared some fun tips to help teach your kids about saving. This week, we’re focusing on “spending”!

Elementary School:

If your kids are in elementary school, it’s a great time to talk to them about money. When children are this young, it’s important to keep everything simple and stick to the basics. Kids learn best by doing. Here are some ideas to get started:

• Discuss the difference between needs vs. wants. Help your child make a list of the things they need and the items they want. The items they want are things for which they should be saving.
• Start a weekly allowance. Kids thrive when there’s structure, but it’s important to permit freedom so that they can envision their own ways to make money.
• Teach choice. A good way to demonstrate that spending is not the only option is to utilize two storage jars — one for saving and one for spending.
• Use cash. Elementary-aged kids can’t usually comprehend the idea of credit. Teach your child about the different monetary bills and coins by paying with cash when they are shopping with you.

Middle School:

Middle schoolers are more aware of the value of money, so it’s important to emphasize the importance of saving during these preteen years. They are also able to understand more complicated financial terms.

• Demonstrate how you save. Share with your middle schooler what you’re currently saving for. When you reach your goal, allow them to take part in the celebration.
• Develop a budget.  When shopping for something for your teen (like a new winter coat or school supplies), outline how much you’re willing to spend and what your preteen will be responsible for spending.
• Introduce the concept of work. Middle schoolers can benefit from learning the concept of work and responsibility. Babysitting and lawn mowing are great things to suggest for first jobs.
• Tackle more complicated money topics. Explain to your preteen concepts like credit vs. debit cards, introduce financial terms like stock market and interest, and show your preteen how to write and deposit a check.

High School:

If your child has grown up learning the money tips mentioned above, they are likely ready to have more control over their finances. Here are some ways to empower your high schooler to embrace their financial independence:

• Accompany your teen to open up their own savings account. Allow your child to be responsible for checking up on their account and managing their payments.
• Use mistakes as teaching moments. If your teen overdrafts their account, it’s ok! It happens. Use this as an opportunity to understand the mistake and discuss how it can be avoided in the future.
• Talk about college tuition. College is not cheap, and budgeting for higher education is critical. Talk to your teen about what they are expected to pay for, including tuition, dining out, organizational fees, and the cost of social activities, as well as any loans that they might be responsible for paying back after college.

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