How aware are your children of your financial situation? Do they simply think that money is always available for them to spend? Or do they worry because they know that you do not have a lot of money? It can be difficult to find the balance of how much your children know about your current financial decision. You do not want to overwhelm them with knowledge that they are not ready to handle, yet it is important to teach them the value of things and how money works.
It can be beneficial to have your children learn your monthly budget. You may not want to give all of your specifics, but rather a broad picture. If your children are old enough you could do this with a pie graph chart and percentages. It is important that your children realize how much things cost in comparison to each other. You can break this down by explaining that an iPod costs five pairs of fifty dollar jeans.
Another great way to help your children become aware of money and the costs of things is to encourage them to save for something. One great way to do this is to plan and save up for a family trip together. You can set a realistic goal that they need to meet in order to go and then you can pay the rest. You can then provide a list of jobs that they can complete in order to earn money to put towards the vacation. They will enjoy this vacation since they helped to plan and pay for it
If you are facing a financial crisis, you may want to explain the situation to your children. For instance if you lost your job you may need to explain that certain expenses need to be cut back. You should do this in a way that does not scare or frighten your child about your future. You might just say that there are no more trips to McDonald’s until you have a new job.
Related Articles:
Teaching Teens to Manage Money by Limiting Handouts
The Importance of Teaching Your Kids About Money