How to Raise Financially Responsible Children

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    How to Raise Financially Responsible Children - Columbia SC Moms BlogChristmas holiday, tax return season, birthdays, a good report card, and weekly allowances are just a few of the ways your child can “feel” rich.

    Recently, I was helping my teenager organize his room. I came across a wad of cash that I knew nothing about. This money appeared to be legit as he explained how grandparents, aunts, and cousins gifted him money over the holidays. In addition to this, I also pay him a weekly allowance for completing chores and demonstrating good behavior in school.

    If you can imagine, he was feeling like a big baller with all this money flying around.

    With his personal allowance that I pay him weekly, I have this money going into a bank account to where I can monitor his spending. Since monitoring his account, I discovered the importance of raising financially responsible children. 

    When I was growing up, its safe to say that my parents were not wealthy. We were not given an allowance, my siblings and I shared clothing, and my parents often worked long hours to make sure the household needs were met. For this reason, I was always intentional about how I spent and saved my money. Since becoming an adult and forced into single parenting, I experienced several days where my money was looking funny and our needs were left unmet. 

    Establishing my child a savings and checking account was a huge accomplishment for several reasons. 

    • I had finally generated enough income to where I can set aside funds for my son. Its not much, but enough to make him feel appreciated for his performance at school and around the house.
    • It secretly acts as a back up account for if some reason, I have exhausted all of my savings and resources and am unable to provide for our household. I pray that I never have to use his/this money, but if you ever experienced rock bottom, then you know of the type of paranoia I speak of. 

    That day I looked into his bank account, I saw several unnecessary purchases to fast food restaurants that made me feel like a failure in this area of parenting. Prior to establishing a bank account for him, I neglected to share with my son the benefits of saving money. I just thought that because my child saw days on how the struggle was real in our household, he would naturally be a better steward over his money.

    Now don’t get me wrong, I believe it’s completely okay for him to spend some of his money to reward himself of his weekly accomplishments and enjoy his childhood/teenage years. What I don’t believe he should be doing is spending ALL of his earned money on excessive eating out and gaming. 

    Since this discovery, I have weekly conversations with my child on the importance of budgeting, saving, and spending money with purpose, so that when he moves out of the home, enters college, or is ever put in an emergency situation and I am not in his presence, he has enough money to resolve his financial problems. 

    So how can you help your children become financially responsible kids? 

    1. Teach them about budgeting.

    I no longer use a checkbook or a checkbook ledger, but I often bring out a paper and pen and give my child a mock list of household expenses. This looks like a traditional math problem. For Example: If your check is $500, the light bill is $175, and groceries $75, how much money do you have left to go to the beach, buy new accessories for the beach, and put gas in the car to get there? This provides a real life experience for him as to what I go through as an adult on a weekly/biweekly pay schedule. 

    2. Teach them about prioritizing their money.

    Using the above example, I aim to teach my child how to prioritize the various wants and needs in life. Is traveling to the beach more important than paying your household expenses? Should you spend all your money at fast food restaurants or is it better to spend some money and save the rest? If you spend all of your money on eating out, how will you be able to save to go on vacations, accessories, and travel? 

    3. Teach them about price comparison.

    This is honestly my favorite lesson because it helps activate another set of eyes when I’m grocery shopping (lol). While grocery shopping, I turn this segment into a sport. I write out two lists of the things I need and include an estimated price off to the side of the item. My teenager and I go our separate ways in the grocery store, on a hunt to find the cheapest prices for the items on the list. If there is extra money left from our grocery store budget, the winner usually gets a treat of their choice.

    Are you currently raising finically responsible children? Inspired to start? What are some ways you are encouraging your child to earn, save, and spend money (or which of the above actions are you planning to implement)?  

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