Money Lessons For Kids

Recently Forbes Magazine published an article called 5 Most Important Money Lessons to Teach Your Kids. In most cases, financial literacy isn't something kids just "learn"- its something that takes time and patience.  If you heard BayCoast Bank VP Jim Rice talk to the Fun Morning show, you'll know that Greater Fall River Lemonade Day is one way to start teaching your kids about finances. Here are some great tips on how to start talking dollars and cents to your kids.

Age:  3 - 5 years old
Lesson: You may have to wait to buy something you want.

Understanding that you can’t have things the moment you want them a hard concept for anyone to learn but most of all for little ones.  If you’re in a store and your child wants to buy something right then and there, the solution may not be saying “We don’t have money for this” but rather, “We’re not buying something for you today”.  Create a moonjar for your child and teach them that “Spending” is for small purchases like a toy, “Saving” is for large, more expensive items like new shoes and “Sharing” is for helping someone who may need it.

Age:  6-10
Lesson: Make Choices About Spending

This is the age where its important to talk about how “Money doesn't’ grow on trees”.  It isn't always going to be there and making wise choices on how its spend will help make it last as long as possible. Include children in financial decisions like buying generic brands v. name brands to save money or buying every day items in bulk to get a lot of stuff for not a lot of money. Ask questions to help them along like “Can we find it cheaper somewhere else?” or  “Is there a sale on a similar item?”

Ages:  11-13
Lesson: The Sooner You Save, the Sooner Your Money Grows

This is the age where goals start to shift to more long-term goals like buying a first car or a new iPod.  Teaching kids about how money is a savings account grows will inspire them to save more.  Now is the time to explain that spending a 1.50 per day on a school snack could be better used if it went into their savings account, helping them achieve their long-term goal.