As parents, we often sabotage the lessons we’re trying to teach about money. We tell kids to save their money, but we don’t save. We tell our kids to be smart shoppers, then we go out and blow money we never meant to spend. We don’t walk the talk, and kids know it.
If you want kids to be good about managing their money, you not only have to give them some (an allowance) and set some expectations (save), you have to demonstrate positive money management behaviours they can emulate.
Stop shopping as entertainment. It may be tempting to bundle the kids up and head to the mall where you can walk and talk and eat and shop and stay warm or cool, depending on the season, while ensuring a good night’s sleep because you’ve worn out your kidlets. Don’t. When heading to the mall is considered a family outing, the message you send your kids is that shopping is a form of entertainment. Head to the gym, the park, or an indoor playground instead. Pack your own snacks and it’ll cost less than a day at the mall.
Tell your kids to ask you why you’re buying something. Encourage them by offering up to 25¢ per shopping trip for asking you a question about shopping. What you want to do is open the conversation and start educating them on your thinking as you shop. And you want them to get into the habit of asking you about things they don’t understand.
Always compare prices. You can turn this into a math game with your kids. When you’re comparing prices, you’re looking for ways to save so you have to add and subtract. Have kids keep track of how much you’ve saved and add it to your “savings” jar at home, perhaps for your vacation fund or for a special weekend of treats for the kids.
Don’t buy lottery tickets. If you’re a saver and have a plan for the future, you don’t need the lottery. When you buy lottery tickets you’re telling your kids you’re hoping for a windfall; you’re not in charge of building your own long-term savings. It’s the wrong message to send.
Set some savings goals. What better time to create a pay-yourself-first automatic savings plan than right at the beginning of the new year. Want to save $1,200 in your RRSP this year? Have $100 a month auto-deducted from your regular account and sent over to your RRSP. Plan to accumulate two month’s worth of essential expenses in the next six months? Don’t wait to see how much is left, send some money to your high-interest savings account from each paycheque so you’re actually working towards your goal. Planning a family vacation? Create a chart you and the kids can colour in together to show how much you’ve set aside and how much closer you’re getting to your goal.
Ultimately kids will learn far more from what you do than from what you say. If you want to deliver a consistent message and be the role model that sets them on the right course, this is the year you clean up your act!