How to Teach Your Children About Money

One of the most daunting tasks a parent has is teaching their children about money. Some parents don't know where to begin, and some don't know how much is too much to teach if their children are very young. Here are a few tips and tricks about how to teach your children about money.

Start when your children are young. As soon as your children learn how to count, that's when you should introduce them to the concept of money. Many parents choose give their children allowances. Giving children the responsibility for something around the house can be rewarded with money. It teaches your children to know that going above and beyond their normal responsibilities and their household chores can result in receiving money. Communicate the fact that if they don't follow through with their responsibility, they will receive no payment. As your children age, give them more challenging tasks to achieve. You don't want a start out your five year old with something as hard as vacuuming the entire house. Start them slowly by having them take the dishes to the sink after every meal.

Talk with your children about the values of money. Teach them how to save it, how to spend it, how to earn it, and how to give it. Good ways of teaching your children this sort of thing is to point out instances in real life activities. If you're at the grocery store, that would be a good time to point out the differences in the price of various items. That's also a good time to teach them the concept of "you get what you pay for". Such as you can buy an item for a lower price, but the product may not be the best in quality.

Another way to teach your children about money is to encourage them to save up for what they want. You can help them create a simple budget in order to begin teaching them discipline. If they want to buy a $30.00 video game, then let them know that they will have to come up with the money themselves. Teach them ways that they can do this, such as offering to baby sit, take a neighbor's pet for a walk, or doing yard work for neighbors.

When your children are a bit older, say around thirteen or so, it might be a good idea for them to have a savings account in their name. Taking your children to the bank is a good time to show them the process of depositing and withdrawing money. When they have their own account set up, they may be more inclined to save money rather than to spend it on a whim.

Teach your children how to keep a record of their spending habits. Have them write down when they deposit money, and how much, as well as logging when and how much they take money out. Teach them about budgeting their money, how not to spend more than what they make. This will help your children make smarter decisions when they're older.

These are just a few ways how to teach your children about money. The younger your children are when they learn about money and how it works, the better off they'll be. By learning the essentials about money, and developing good spending habits will benefit them in adulthood.

Bob writes about getting out of debt, saving and making money, and other personal finance topics at ChristianPF.com. Stop by and download some Free Budgeting Software, learn how to make a little money blogging, or start taking steps to get out of debt.