How to Teach Your Kids to Save, Spend and Share in 2010

We were recently asked to give an update in the JUMP$TART NEWSLETTER and we said:

Imagine how different the economy would be today if every child knew the basic pillars of financial money management, saving, spending and sharing, as commonly as “stop, look and listen.”

For more than eight years, Moonjar (www.moonjar.com), the leading international provider of children’s financial literacy tools, has helped children and families learn the three basic principles of money management: saving, spending and sharing, through a line of creative products aimed at helping parents and children take the first steps towards a healthy financial future. We must not forget that our as role educators, business leaders, and parents is to provide students with the best of both worlds: a strong and challenging academic curriculum, and a full infusion of the 21st-century skills students will need to succeed.

Starting a conversation about money with kids can be tricky. We have developed six tips for parents to teach their kids to save, spend and share their allowances—even at a young age.
1. Start with a visual tool. Most children, beginning at age 4 or 5, are visual learners, so using a hands-on tool like the Moonjar Moneybox, a bank with three compartments—one each for saving, spending and sharing, can better help them learn responsible money management through critical problem solving.
2. Make money a “yes” conversation. Use pictures to help your kids visualize their goals and then prioritize what they are saving for, what they want to spend their money on, and with whom or with what they want to share their money.
3. Discuss wants vs. needs. As you set goals, identifying objects that represent “wants” and “needs” helps to overcome the desire for instant gratification.
4. Allow mistakes. Children, like adults, learn from making mistakes. From time to time, allow your child to buy a toy you believe will not be enjoyed very long, for example. Sure, they may be disappointed in a few weeks, but many lessons can be learned from this experience. Encourage them, without guilt, to plan their future purchases, weigh the cost and the benefit of their choices and to think twice next time, even sleep on it.
5. Encourage philanthropy. Help your children understand that they are part of a larger world community through discussions about sharing their money and/or donating time to causes of their choosing. Volunteering as a family is a great activity for all to participate, learn and grow.
6. Be a good role model. Make sure your children see you doing the things that you are teaching them. Let them in on your bill paying, savings and investment plans and charitable giving. Discuss your attitudes and philosophies about money and tell them your dreams for how your money can fuel your passions.