People aren’t born with money management skills but fortunately, it is a talent you can learn! Like most skills, practice makes perfect! I recently decided I wanted to change our financial situation through saving. I decided to train kids, teens and other adults in my home to manage money and correct any poor money habits my family may have. You don’t need a college degree or certification to teach them these important money saving skills. We can empower our families! Here’s what I did.
Teach the Kids
Start teaching kids how to save by giving them a weekly allowance. Kids need a regular money supply if they are to master this skill. Present each child allowance in $1 denominations. This will make this activity easier. Spread the money out on a table. Help your child shop for an item in a circular or catalog. It needs to be something he really wants.
Distribute the cash and count it out loud. Talk about how much the toy cost. Talk to the child and tell him how long he needs to save to purchase it.
Help the child decide how much he will save each week to make the purchase. For instance, the toy that is $20 but the allowance is only $10. Explain that he will need to save money each week to buy it. Show him how to save and spend. He could save $5 and spend $5. Help the child count his money and save it every week.
Teens Need Help Too
For this money saving exercise you need some Monopoly or play money. Give each teen $500. Talk about how much money he needs to save each week. Talk to the teen about what he’d like to purchase. Work on a plan on how much to save each week to reach that goal. Ideally, he or she should save around 20 percent each week. Have him place the “cash” in a plastic storage bag or jar.
Now take 10 percent of the paycheck for taxes. Ask him to pay his car insurance, that’s another $100. Tell him to give you another $100 for food. Show the teen how much he can save in three months, six months and in one year.
Now, the Adults
If you want to teach an adult, lead the conversation by asking him how much he needs to save. Work on a budget together and include personal expenses, utility bills and rent. With a notebook, start with his personal income and deduct the bills.
We’re a work in progress but our family’s money saving skills are improving. We can do it!
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