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Helping Children Develop Street Smarts

10 Ways to MakeYour Children More Resilient

Money Doesn't Grow on Trees: Teaching Your Kids the Value of a Buck!

Banking on Our Future: A Program for Teaching You and Your Kids about Money


by Marc Eisenson 

In addition to giving children an allowance, there are many other things parents can do to teach kids about how to handle money. And with all the TV commercials children watch, it's more important than ever to help them learn how to distinguish their needs from their wants--how to make choices about money.

Unfortunately, many adults themselves are confused about needs and wants, and set a bad example. (Can you remember the last time you stood at a cash register, money in hand, and asked yourself, Do I really need this?)


If you don't have the knack for money management, take heart. You can get better in time if you work on it. Remember, the example you set on how to spend, save, and earn money will make a difference. Here are some other things you can do.


  • Explain the difference between wants and needs. Teach your kids that food; shelter and clothing are on the short list of human needs. In our society, electricity, transportation, and phones also fall into the need category. Designer clothes and cereal in the shape of cartoon characters qualify as wants.
  • Let kids know that your first responsibility is to provide for the family's needs. Once you have paid for the basics, explain that the family can choose to spend the remaining money for fun things, but that it would be wise to put some money aside for future goals such as taking a vacation, buying a house, or paying for college.
  • Make it a point to watch TV with your children. Pay attention to the commercials that they see. Help kids understand that products are heavily hyped. What they see is not necessarily what they get. It's important for kids to learn from their own mistakes, but that's not a message you need to pound in.
  • Pass along your own ideas of what's worth buying without dictating how children should spend their allowance or money they have earned. For example, let your kids know that you're happy to buy them a perfectly fine pair of sneakers for $30. If they decide to upgrade to a designer $100 pair, it will be with their own funds. Make the point that they will have $70 less to spend on something else they would enjoy.
  • Talk to kids about how you make and spend money. Even young children should know that you work for every penny, nickel, dime, etc. and that cash from an ATM machine isn't magic money. It's money you worked hard to earn. Ditto for checks and credit cards.
  • Try using an eventually list. Develop a wish list--a record of what you most want to have or do. We called this our eventually list, and it helped us as a family to prioritize. Sooner or later, most everything on the list got covered or lost its appeal. Knowing that something will happen eventually calms the need for instant gratification. So next time your kids must have something, make it easy for them to save for it, a little at a time. If they don't lose interest in it, they will really value the prize once they have saved long enough to make it theirs.


(adapted from Work & Family Life newsletter, edited by Susan Ginsberg)



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