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Kids and Money – Cut Down on Requests for Stuff

The U.S. Department of Agriculture came out with a number this year that probably won’t startle any parent, who is trying to keep a teenage boy’s hunger at bay or pay for weeks of summer camps. Kids and money just go together it seems.

The agency found that the cost to raise a child born in 2015 will reach about $233,000. The forecast is for middle-income, married-couple parents, who, together, earn between $59,000 and $107,000 a year. The agriculture department’s estimate includes food, shelter, transportation, health care, clothing, child care and other costs.

It’s probably mixed in there somewhere, but the agency’s report included no line item for “giving in to kids’ constant demands.” But, as any parent knows, giving in to those requests for the latest video games or a three scoop ice cream cone can add up.

Follow these tips if you’re ready to teach your kids the difference between needs and wants and are tired of the demands for more, more, more …

Kids and Money Tips

Give them an allowance

There are two schools of thought on an allowance. Some families give allowance as a payment for chores. Others give it to their kids as a way to simply teach money management and don’t tie it to household work. Families must decide what works best for them.

The American Academy of Pediatrics recommends that, whichever route you choose, it’s important that you are clear about why your child is receiving an allowance and stick with the agreement that you’ve made.

The academy recommends giving children a small amount, which they can use for spending money and to learn the importance of saving. Some families require kids to save and donate a percentage of their allowance.

Encourage them to earn their own money

Earning their own money helps kids understand and appreciate the value of hard work. Help them set up a lemonade stand and make handmade bracelets to sell to their friends. Find out if a Children’s Business Fair, a national network of markets where kids can sell their products or services, is near you.

Older tweens or teens can babysit, mow lawns, walk dogs or pick up the mail for neighbors when they are away. Sites such as Etsy, Fiverr, Swagbucks and others also offer new money-earning options for some kids.

Set limits -- and stick to them

If you said “no candy” as you walked into a big box store to run an errand, stick to it. Don’t give in to your kids’ requests for candy or toys or treats -- regardless of how much they cry or beg for the items. Stay strong! It’s in their best interest for you to stay on a budget as you run that errand.

At the same time, if they need a new pair of jeans or sneakers, let them know your price limit. If you set the price that you’re willing to pay for new shoes at $30 and they want a $50 pair, let them know that they can spend their own money to make up the difference.

Teach them the value of the dollar

Have conversations with kids early and often about money. During a trip to the grocery store, compare prices with them. Set up a savings account for them so they can watch their money grow. Teach them how credit cards work. Kids.gov, the official kids’ portal for the U.S. government, offers parents some tips and talking points on the topic.

When it comes to kids and money, the demands for stuff won’t immediately go away. But, over time, kids will start to realize that you’re not made of money and, just maybe, they can pay for whatever they want on their own. Even better, they’ll develop money management skills, which will serve them well throughout their entire life.

Consumer Education Services, Inc. (CESI) is a non-profit committed to empowering and inspiring consumers nationwide to make wise financial decisions and live debt free. Speak with a certified counselor for a free debt analysis today
 
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