It is never too early to begin teaching your kids about budgeting money. Starting young and learning smart spending skills will help kids grow up to be fiscally responsible adults. With summer chores around the corner, now is a great time to teach kids the basics. So, how do you start?
As President of TruWest® Credit Union, Alan Althouse offers some simple tips to help kids learn about money management and budgeting.
- Provide money to manage:
In order to learn how to manage money, you have to have money to work with. Warmer weather is the perfect opportunity to set up a chore chart, allowing kids to earn an allowance. From cleaning the pool, pulling weeds or straightening their room, providing different chores will teach children the earning process. Here’s a tip: Encourage children to keep their cash in a clear jar to help them understand visually how much they have.
Sometimes leading by example is hard, but showing kids how to shop smart is easier than you think. Bring your kids shopping, or show them how you shop online, and let them experience how to compare costs first hand. Take advantage of summer sales and take the time to talk to them about deals and coupons. This will teach them how to make their money last longer. These are the beginning steps of budgeting, which will be a great foundation to grow with later on.
- Open an account for your child:
Many credit unions, like TruWest, let parents open an account in their child’s name. Opening an account has many benefits. Getting your children involved in the banking processes connects them to the concept of saving and spending.
- Help kids understand price:
When your child wants the latest toy or game, make sure to point out the price. Simply calling attention to these numbers will engage your kids in the spending process. Try having children play an active role at the checkout counter, seeing the money or handing it over to the cashier. These actions will leave an impression of the trade-off when spending money. As your kids spend their earned cash, point out the shrinking amount. It is crucial for children to understand the value of their money compared to the items they want.
By engaging children in money spending activities and teaching them the basics of management and budgeting, they will have a strong foundation of financial knowledge for years to come. For more information on financial tips or to learn more about TruWest Credit Union, visit TruWest.org.
Written by: Alan Althouse
Alan Althouse is the President and Chief Executive Officer of TruWest Credit Union. TruWest Credit Union is headquartered in Tempe, Ariz., and operates as a cooperative to provide its membership with a lifetime of quality financial services and a culture of caring for its members, employees and communities. TruWest is a strong and sound financial institution with more than 85,000 members and assets totaling more than $1 billion. TruWest Credit Union has 13 branch locations—nine in metro Phoenix and four in Austin, Texas. For more information, visit truwest.org.