Thank you to Beth Kobliner and The Motherhood for sponsoring this blog post.
As parents we have a lot of lessons to teach our kids; parenting is no joke. One of the lessons that I feel gets forgotten by a lot of parents is the money lesson. Maybe you are thinking you can wait to have that money lesson or talk with your adult children or maybe you feel like school will be a great resource for them instead of teaching them yourself? Did you know, you have the opportunity at any age to teach your child about money?
How do I Make My Kid a Money Genius?
That sounds like a difficult question to answer, especially if you are like me - NOT a money Genius! Seems like a fraud to be teaching my kids about smart money habits, but as I started this I learned so much along with them. Kids are incredibly smart, which is exactly why parents should be talking about money lessons at a young age. They listen, they want to learn, and they retain it too!
To help me in this money lesson I started using the book, Make Your Kid a Money Genius (Even If You’re Not) , a jargon-free, step-by-step guide to help parents of all income levels teach their kids from ages three to twenty-three about money.
This book by Beth Kobliner is a super easy read and the perfect book for families who want to start learning how to be money smart. This book gives a ton of great detail but also adds a little humor - goodness knows, we need that we talk about finances!
My favorite part about Make Your Kid a Money Genius (Even If You're Not) is that it gives the parents details on how to deal with the worst. You know, like those days you are in the checkout line at Target and your kid sounds like they are going to die if you do not buy them the candy bar. Yes, she tells you how to deal with that. Perfect for our family right now. Ages 4 and 6 are rough!
I have always been one to be honest with you all, so here I am again today, inviting you into our little family. We are the parents that have probably bought our kids way too many THINGS without them having to earn it or even understand why Mommy and Daddy have to use money to take that new game or toy home with us. So, we are way behind on this whole money lesson but we are determined to make some big changes and introduce great financial thinking to Jude and Teagan.
Saving money has been a big topic with our kids. After Christmas, they both had some cash from the grandparents and of course the instant they saw that money they wanted to go blow it at the toy store, even though they had just received about 100 other toys for Christmas. This led us to the whole saving money thing.
In Chapter 2 of Make Your Kid a Money Genius (Even If You're Not), we have learned a lot. Beth makes sure to outline tips on each money lesson in age appropriate lists. This is super helpful for parents. I didn't want to confuse Teagan or expect too much of Jude.
Money Genius Tips for Preschool Aged Kids:
It's Good to Wait: Waiting is hard for any person at any age but a great way to promote saving money is by sharing why it is good to wait. This is great time to sit down and help your kid see the benefits of waiting for something. Giving Teagan examples has helped her understand this concept.
Save Your Money in a Safe Place: The traditional piggy bank works great for Teagan. She loves putting her special money in her bank. This includes her coins that she finds at the park and also the cash she gets from gifts. This helps her feel like her money is safe.
Three Jars: While we have not started this yet, we will soon for both Teagan and Jude. Instead of just the piggy bank we will have the piggy bank for savings plus 2 other jars - one jar for people in need and another jar for current purchases. This also drives home the theory of - do not spend it all in one place!
Teach kids about numbers and coins: I love teachable moments and this whole money lesson is a huge teachable moment! Take time to have your preschooler sort, count and estimate with the coins and cash. Teach simple math when sorting into the three jars. This is a great way to start introducing the preschool age to math, counting and saving!
Jude is right in between the preschool and grade school groups, and since he is pretty advanced we have decided to follow the tips for the grade school kids that Beth suggests.
Money Genius Tips for Grade School Aged Kids:
Pick a Rule/Goal: Kids this age need a goal. Beth suggests saving a quarter for every dollar you get. This is not only a great ratio but it is a great way to get those brains thinking about numbers and math. This gave us a teachable moment for Jude. We sat down with him and looked at his coins and cash and added up what would be saving vs. spending. This rule/goal will hopefully grow into a healthy saving habit for kids.
Interest and Banks: We still have Jude using his piggy bank and will also introduce him to the three jars method. We will be going to our credit union to set up his own savings account and will have him come with us when we do this. It will give him ownership of the account and motivation to save money. We will continue to save cash and coins in his piggy bank and make bi-yearly deposits to his savings. Something for him to look forward to.
Matching Programs: Why do we contribute to 401k programs more when our employer also contributes? Well, because we are smart. It is basically free money. Kids get that. We will be setting up a Mom and Dad matching program for Jude. Now, Beth reminds us to think small - you do not want your hoarding kiddo to break your bank!
Think of Opportunity Cost: Jude is the kid that wants to buy lots of little things because they only cost a couple bucks. We have had to show him how much money is wasted when this happens. Most of the time the small toys get lost or forgotten. Sitting and talking to Jude about the cost of opportunity really has changed the way he thinks about the toys or things he really wants to spend his money on.
That is a lot of information and let me tell ya, that is only one chapter. Beth Kobliner's book is full of amazing information and tips. This is one of those parenting books that I will not give away once my kids are in grade school - this will be a book that is used for years in our family. You can purchase your own copy on Amazon or at Barnes and Noble or at your local bookstore.
Money Genius Facts to Consider:
- Caving to your preschooler’s demands at the checkout line could make him more likely to misuse credit cards as an adult.
- Giving your kids an allowance might actually be a step in the wrong direction.
- Opening a brokerage account to teach your teen about the stock market is a mistake.
- Doling out a wad of cash can be a great parenting move.
- Bribing your kid for A’s is a waste of time (and money).
- Letting your adult kid move back home is a smart idea…s o long as you both have a plan.
- Encouraging your 16-year-old to open an IRA is not as crazy as it sounds.
- Paying for household chores may turn your kid into a slacker.
- Talking about paying for college with your 14-year-old may seem premature. It’s not.
- Co-signing a credit card for your kid is always a bad idea.
Are you doing it wrong? We were, and we have a lot more to work on as a family!
It is never too early to start this talk with your kiddos. This guide is perfect for ages 3 to 23 and is also the perfect refresher for parents! Let's teach our kids now, so they do not flounder later in life.
What money genius tips will you teach your kids?