The holidays pose an excellent time to teach your child about money. The season is one of gratitude and good will toward (all) men, but it can also be about teaching financial restraint, taming impulsivity, and budgeting. The younger the child is the greater chance of you, the parent, in being able to help them develop a positive attitude toward money.
It’s also a great time to teach children about what they want versus what they need. Helping them gain a perspective as to the difference between an item they see online or a store window and essentials like socks and underwear, promotes a strong sense of gratitude and appreciation for the things they already have.
Give them Extra Chores
Whether you give them an allowance already or not, find tasks around the house and yard they can do to help them earn money for the holidays. This can be a practice you institute all the time (doing money for extra chores) or you can tell them upfront it’s a way to help them save for the holidays.
- Raking leaves
- Organizing cupboards
- Clipping coupons
- Preparing meals
- Lawn mowing
Instead of paying them cash for their allowance and extra chores, give them a Visa gift card. This will allow them to save their money and they will have just as much purchasing power. Visa gift cards can be customizable, so you can include your favorite photo of them (or something they love) on the front of the card, and include an inspiring quote as text such as “Way to go!” or “Keep up the great work!”
Help Your Child Create a Budget
It’s easy to get overwhelmed with buying people gifts for the holidays. People tend to overspend, and children are no different. Not yet grasping the concept and value of money, this is where you, the parent, step in.
- Write a list of their gift recipients
- Add how much money will be spent on each person
- Write down what the child would like to give to each individual
- How much money does the child have now?
- How much does he/she hope to earn?
- Discuss gift alternatives such as DIY and homemade gifts
Teach Children about Value
Brand names tend to be much higher priced than their generic counterpoints. Kids often get caught up in the idea that brand name labels are best. Teach your child as soon as you can that although brand name labels may be nice, there is nothing wrong with clothes, sneakers, cereal, handbags, etc., that are not slapped with a brand name label. Once children are able to see that there are less expensive alternatives, they will be able to make better, more cost-efficient gift choices.
Encourage their Entrepreneurship
Kids that have their sights set high on raising money for their holiday gift giving, will likely want to expand beyond the confines of extra chores at home. Encourage their ideas to make money by raking leaves in neighbors (and family’s) yards, shoveling snow, organizing, pet sitting, dog walking, and whatever other reasonable service “business” they can think of. Keep in mind that you will have to rely on you for transportation to and from family homes that are outside of your neighborhood.
Teach them Online Safety
Most kids spend a considerable amount of time online, so they may be familiar with the process of making purchases, but if they aren’t, give them a lesson.
- Be cautious of deals that are too good to be true
- If it’s a new business, do the research to make sure they are legitimate
- Shop with only reputable retailers
- Don’t browse or shop on a public Wi-Fi
- Check the site security before making a purchase (https and not just http)
- Never give out personal information
Give them Empowerment over their Choices
It’s important to guide kids through the process of budgeting, weighing wants and needs, and figuring out what gifts they will give to the people in their life. It’s also important to set them on the course, and let them navigate it. Providing them with the ability, space, and opportunity to make their own money, and to get creative is giving them power over the process that will help teach them fiscal responsibility for the future.