Friday, April 3, 2009

Teaching your kids about money

We give out a daily financial tip on Twitter @family_finances. During the past two weeks, we've given out tips for teaching your children about money. We thought it would be valuable to list all of the tips here together.

Can you explain your household budget to your kids? Get them involved early so they understand how money works.

An allowance should be earned by doing small chores. Teach your kids money is earned, not freely given.

When your kids receive money, require them to save some and give some to charity, and only spend a portion.

Do your kids know that you support charities? If not, it’s good for them to know. Teach them why you support what you do.

When it comes time to choose a college, don’t allow kids to think you can afford anything they want. Tell them there are limits to what you will spend.

Don’t bankrupt your own retirement to pay for kids’ college. They can borrow for college. You can’t borrow for retirement.

Help kids understand your values and why you won’t buy certain things. Give them a good reason and you’ll teach them something.

Grown children need to support themselves. You aren’t doing them any favors by giving them handouts.

Watch the spending on fast food. It adds up quick and it’s not healthy, either. Teach your kids how to eat on the go without fried food.

Live your financial life in ways that are consistent with what you teach your kids. They’ll notice if you aren’t consistent.

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