7 Realistic Tips For Raising a Money-Conscious Child

Even with adults, it's easy to shy away from the topic of money. Not only can this conversation be confusing, complicated, and lead to uncomfortable questions, but it can also be very easy to avoid. However, it's essential to be open about prices, spending, and budgeting with kids instead of not concerning them with it. The more you expose your child to the concepts of financial responsibility, the more they will understand and put them to use as they get older.

When you start the discussions about money, get them involved in some of the daily decisions. From working together to pick out items at the grocery store based on sales and the family budget, to giving them options for bigger purchases and family trips, it's important to include your child in some aspects of the family finances.

However, just as you don't want to completely shield your child from all financial realities, you also need to introduce concepts and rules that are realistic for their age. Starting with the basic concept of a piggy bank and distinguishing wants versus needs for small children to discussing long-term and short-term goals with teens, consider their age when you break down the specific concepts that you'd like to teach your child.

Although having an allowance is a great opportunity for children to learn how to save their money and budget towards a want, there's also another side to the debate. Some don't feel they are teaching their child the right message by paying them for chores or tasks they are expected to do. Just as you don't get paid for making your bed or cleaning your room in the real world, they believe children shouldn't expect to receive a paycheck for being responsible and contributing expected tasks to the household. However, when your child goes above the basic cleaning and takes on odd jobs, this is a great opportunity to pay them for their work and teach them how to work towards personal financial goals.

This isn't just about worrying about preparing for college when they are still in utero. Taking your child into a bank, having them involved in the process of opening the account, and being consistent with making deposits with them is essential. Whether you come up with a system of putting in $5 a week or month, or always agree on setting aside a certain percentage from holiday and birthday money, making these small deposits turns into a lifelong habit and understanding.

You don't have to have a perfect credit score or a booming savings account to raise a money-conscious child. However, you have to be aware of the example you're setting — like how impulsive you are, what you prioritize, and how you treat your credit cards — that can have an impact on your child's financial views far before you realize. Something as simple as saying, "Don't tell Daddy what we bought, it's our little secret," can be setting your child up for a warped sense of spending and accountability.

In the heat of the moment, it can be very easy to just tell your child no or try to distract them every time they make a pricey request. But instead of always telling them to put back the toy and ignoring their tears, use these as teachable moments to explain why it isn't possible or even reasonable to get something each time you go the store. When you do say yes, be just as transparent with your child – whether it's because they've picked something that was a reasonable price or because it's something that they need — to help them gain a better understanding.