When the word budget comes up it can evoke fear or memories of long drawn out meetings in the corporate world. Kids don't have that reference, for them it is a map! A great way to introduce a budget is simply to tell them what it means: A PLAN FOR SPENDING MONEY.
Sometimes the plan will work out just as it was laid out and other times the plan will have to change but taking a little time to create a plan and track it will help to create wonderful money habits.
Try keeping a budget this month. You can even work it backwards to start- keep track of everything you saved, spent and shared for a month. Then next month start with that map to help you decide if you would like to save a little more and spend a little less or maybe you want to make a big donation to school so there will be less to spend. There is no right or wrong answer but the practice of creating and following a budget will be sure to help you feel good about what you are doing with your money! Make sure you celebrate when you match your budget!!
Allowance is a great way to help children develop positive money habits.
Children who are asked to make choices with their own money on a regular basis are more likely to ask questions about money, save money and understand the importance of giving back.
As a parent, the toughest piece is sometimes remembering to have "cash on hand" for "payday". We were successful with a allowance in our house when we made the collection piece our children's responsibility. When I was growing up my dad remembered to give us allowance each week but in our busy house I am lucky if I remember dinner so it worked for us to have them come to us on Sundays.
Allowance is a tool to give kids a chance with money management! The amount the kids are given does not make nearly as much difference as the fact that they are given money on a regular basis and asked to manage it. Older children can be given real responsibility with allowance, like buying lunch at school once a week.
They say it takes 21 days (weeks in this case) to make a habit stick......give it a try!