Teaching Children About Money

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  • How to teach child not to "waste"?

    – Jul 21, 2022
    (8 replies)

    I'm at a loss. My almost 7 year old just does not understand the concept of saving something or that everything in our house we have to spend money to buy.

    Examples:

    he's at an age where we are encouraging him to make his own breakfast and snacks (cereal, apple sauce, scoop nuts, grab some chips, some cheese, etc, nothing with fire). Most of the time he takes too much and then doesn't finish, and then the food ends up getting thrown away, or I'm the garbage can and eating it. I'm so tired of having to constantly reminding him to not take too much. And I'm sure he's tired of my nagging as well. 

    Or we go to the park with a ball to play catch. We toss it back and forth, everything is great, and then he'll do a huge throw on purpose to make me have a hard time catching it, and the ball ends up in the bushes where we can't find it, and he'll say that's ok, we have another one in the car. But that ball cost me money! 

    Or he has a ream of printer paper that is all his for art and crafts, writing, drawing, paper airplanes, anything. I guess a ream looks like an endless supply, he will often start to write something and with a little mistake, he'll throw away the whole page instead of erasing it or flipping it over to use the other side.

    He also uses an exorbitant amount of soap when showing/washing, never remembers to turn off lights, squeezes way too much toothpaste... you get the idea. We are not rich, we're one income, we rent, I work long hours to try and save money so we can buy food, pay rent, insurance, etc etc. Both sets of my grandparents lived through WWII and my parents were children then, growing up I was very aware of the need to save because that's what everyone around me did. How can I teach my child to be more aware of what he consumes, to not waste? I model good behavior daily, but it just doesn't register for him and he has no worry. 

    Jul 21, 2022

    This drives me nuts with our kids too! They’re a little older - 8 & 10, so we’ve tried a lot of things. When the 10 yr old was younger, he went through jackets like they were water - lost them over and over again. The younger one went through water bottles in a similar way.  Drove me nuts.

    I can’t say we’ve solved the problem - its an uphill never ending battle - but one thing that helped for us was making our kids responsible for replacing lost / used items. We provide an allowance to enable this. So the first item is on us, and they replace from there.

    The 10 yr old seems to have finally stopped losing jackets. He went through about a year of searching the lost and found, asking for hand me downs from friends (and wearing too small jackets), and consignment shopping. The 8 yr old doesn’t get a fancy water bottle, and now refills a disposable bottle or freebie bottles. 

    For food, we tried saving it and putting it with the next meal or in a lunchbox which is sometimes effective. We also limit to one scoop and guarantee seconds during family meal. But there’s still a lot of food waste.

    I have completely given up on soap in the shower and just accept that. I buy it in the enormous bottles with a pump dispenser which at least limits how much they get per pump compared to a regular shampoo bottle. For hand soap I switched to the foaming kind so filling the hands uses much less soap.

    Interested to see what other ideas folks have.

    This is typical today because we as a country are so affluent! I grew up without much and it drives me crazy to see kids so wasteful. I noticed that my son doesn’t care what I model, but he cares when it affects him directly. When I tell him “this is all I am paying for. If you use it all, lose it, or waste it, you will have to pay for the replacement” it gets his attention.  Ultimately it is up to us to not give them endless resources. Let things run out. Let them understand that actions have consequences. Then you will get their attention.  

    My daughter is almost 7 but she is very conscious about not wasting things. I’ve found that the money argument is lost on her but we talk a lot about resources and how that effects the planet which she is very concerned about. So if she lost the ball she knows that it’s plastic and won’t decompose so we can’t just leave it on the ground (for example), or that wasting food (or water, or using too much “stuff”) is bad for the environment. My son who is 4 has a lot harder time and will toss things on the ground without care so I do think there’s some personality too! 

    It seems like you are expecting your child to make judgments that he does not yet have the ability to make. The things that you describe are not innate to children and they will be impulsive sometimes. Some of the things you describe sound like a sensory-seeking child, as well. If that seems accurate, you may want to look into appropriate ways to meet those needs if you don't like the materials that he is choosing. It is great that you are encouraging independence at such a young age, but maybe he needs a picture or a rule to assist him in making appropriate portion sizes. Instead of giving him fresh paper to use, have him use the back side of used paper. If he is struggling with perfectionism, encourage a growth mindset. Reminders and nagging may make it worse if he wants to get a reaction from you, and it may make him feel bad about himself and compromise your relationship. When you are stressed about having lost the ball, he may be trying to reassure you by saying there is another one there. He is young to understand money and there are many reasons besides that to conserve. Find creative ways to share with him why conservation is something that your family values and he will adopt it when he is able. 

    I give our 7 year-old a $1 allowance weekly, regardless of chores/behavior. Between that, cat-sitting, and the tooth fairy, she usually has about $20 in her piggy bank. When she wants a non-essential (like a new sweatshirt, despite 3 perfectly good ones in her closet), we research prices together to see if she has enough money. Once she does, I let her purchase it with her money. She occasionally (every three months?) requests to go the the toy store to spend her money, too, which I honor most of the time. I wonder if a strategy like this would work with your ball scenario (though not really with food or shampoo).

    As the child of 2 parents who went through WWII UK rationing, I hear you. But 7 is pretty young, and it is a marathon. There are a lot of different types of "waste" in this letter, and I think I'll encourage you to focus on 3-5 max, for a while. Then move on to others. If it were me, I'd really drill down on the idea that a ball or whatever can immediately be replaced. Look at your own consumption and make sure you're modeling what you want him to learn. Talk about making do with old things, and fixing vs replacing. I don't think it's inapprpriate to tell your kids that you do not have a ton of money. I'm a single mom and I have hammered this point home to my son. I explain we're not in danger - we have funds for safety. But we can't spend those and we have to be careful. I literally just had this convo with him yesterday, and he is 16 ... and generally very aware of money and a saver. You might try a small allowance to start to teach saving. (This didn't work well for us until ours was 9.)  You could sometimes make the child choose - get a new ball? Then give up ice cream for a week. Etc. Make them think about the costs. For meals, we both modeled some restraint, and also just guided when they served. One genius trick that a friend turned me on to was - we prepared and served veggies first, like an appetizer. I'd make big plates of rainbow veggies, maybe some dip (but not usually) and just put it near them before dinner - and us. Then when it was all gone, we'd serve the rest of the meal. I believe this helped make our child a very relaxed and enthusiastic eater of all fruits and veggies.

    Okay and - jacket loss is age related. It ends around 5th or 6th grade, I'd say. When my son lost a couple of really nice jackets, we replaced them with ones from a thrift store, to get the message across. (Honestly, he didn't care.)  Good luck :-)

    I had a couple of thoughts - re: the food - can you provide some sort of scoop that would give him an appropriate amount of cereal, chips or whatever, and tell him he is only allowed that one scoop at a time, until he is finished, and if he wants more he uses the scoop again?

    For the park example, I'd say, if the ball gets lost the game is over and you go home.

    Don't give him a ream of paper, give him 10 sheets at a time (a week or day or whatever) and when he's done with them he waits until the next day/week to get more.

    Soap and toothpaste are hard, my teen son is still working on those LOL. But with lights, how about teaching him about energy and the earth and climate so he starts to understand that using those lights means burning fuels and making the world hotter, etc.

    How about starting to give him an allowance and see how easy it is to spend all his money? My DD never understood what it meant to spend your money until it was HER money that she was spending, and now she is a big saver.

    I hope some of these ideas help, above and beyond that, he is only 7 and if you keep at it I'm sure he will learn eventually!

    Haha I accidentally made my kid scared of wasting!!!

    In Japan we don’t have a “boogie man” instead we have “mottainai baasan”. Mottainai is difficult to translate but it roughly mean too good to waste. And baasan is grandma/hag. The other day when my daughter was wasteful what my own mother used to say slipped out of my mouth. I told her that when she is wasteful mottainai hag is going to come. I saw the fear in her eyes and I felt bad remembering how I was also scared of the same hag. But I guess I don’t mind it too much. We have had conversations that this hag is not a bad person she just remembers the old days when children needed to wake up when it’s still dark out to fetch water etc.

  • How much spending money should an 8-10yo have?

    – Jan 13, 2020
    (4 replies)

    I'm curious, what do your young children (8-10 year olds) spend their own money on?  My child has money he gets from gifts, finding change in pocket while doing laundry or on floor while cleaning (which he can keep), and some extra tasks he gets paid for (like tutoring younger sibling, doing chores not assigned to them, babysitting, etc.).  Our rules are he has to put 50% of it in the bank to be saved for car or large parent approved purchase (likely a cellphone in a few years), and the other 50% he gets to keep for spending.  Anything above the 50% he adds to the bank account we match to encourage more saving.  The amount he keeps for spending in his piggy bank he uses to bring to school to buy candy or other stuff from various fundraisers, buy school lunch (we always send home-made lunch with him but if he wants to buy lunch or snacks he is allowed to use own funds), uses during the Scholastic book fair to supplement the funds we give him, uses to buy gifts for family (sometimes as we encourage hand made gifts), and birthday gifts for some of his friends (we cover most of them, but some he contributes to in order to make it nicer). 

    I know roughly what balance he carries in his spending money fund (and his saving account is on track and doing well) and as we are making the decision to implement an allowance for him we are curious other other kids use their free-to-spend money on in order to set his allowance accordingly (or not do it at all) or increase the expenses he is responsible for.  

    Jan 13, 2020

    My daughter's spending in elementary school was similar to yours: school lunch (until she got sick of it) and book orders, mostly. We divide her allowance into three bins. In addition to the "spend now" and "save for something big" (with approval from mom and dad), we also designated 20% as "save for college." I figured it was never too early to learn that you don't get to keep you entire paycheck (I remember my shock at my first real job seeing how much money taxes ate up), and it also got her thinking about and invested in (literally) the idea of going to college.

    Now that she's older (15), she spends more on snacks and going out with friends, clothes, gifts, and other "wants."

    My own goals of my kid spending his own money are:  1) learn delayed gratification  2) make good AND bad purchases to learn from experience and  3) learn value of money and how to spend carefully.  So I actually want him to spend and control his own money.  Allowance was purposefully modest : $1-2 per week. $1 starting in kindergarten $2 by 5th grade, with no requirements placed on it.  There was also the tooth fairy, plus birthday/christmas money from grandparents totaling under $100 each year (w/context that the grandparents wanted him to choose a toy). He's had a bank account since infancy. We had engaging conversations about the importance of having savings for the future... since saving is happening voluntarily, we don't have a formal requirement.   Routine household chores are are not compensated, but there are occasional opportunities to do an extra chore for money.  When he finally bought the coveted Nerf, he took good care of it.  He carefully researched lego sets before choosing the perfect one.  Buying toys from yard sales or flea market with his own money was a popular pastime.  He learned that buying secondhand was a often a good value.  Buyer's remorse is also a powerful teacher -like  buying a toy that looked fun based on marketing (but wasn't), or a toy that broke quickly, or that time he just had to buy an artificial blue drink out of a vending machine, then after taking one sip, thought it tasted terrible, and ended up dumping a nearly full beverage down the drain.  $1.50 worth of regret was well spent that day.   When we are out running errands, one of my pat answers to requests to buy restaurant food/fast food/snacks is, "Sure, with your own money."  If buying food, etc from concessions is part of the outing, I will hand my kid a bit of spending money - whatever is not spent, he can keep, but if he wants more, it is from his own money.   His having control over his own money really shuts down the asking to buy things.   We encourage and model generosity too, sometimes he will buy a small gift for a friend or family member when he sees something he knows they would like.  He has accompanied me every December since toddlerhood to buy a toy and deliver it to the local fire station for Toys for Tots; last year he decided on his own to buy one with his own money.  By middle school, I think he had a lot of practice at saving, delayed gratification, and making spending decisions.  I do have to say a calm personality and lack of impulsiveness has helped too. 

    We didn’t budget what portion of our child’s allowance money could be spent on what. We talked openly about our own spending decisions, so that we communicated that every decision was a trade off of some sort. We explained that we saved for larger purchases, then, when they wanted something more expensive, we helped them figure out how long they would need to save for that purchase. Before long we were parenting a champion saver.

    Very early on our kid started making charitable contributions on their own, with no urging on our part. In fact, one day they told us that we should be giving a lot more to charity; we told them how much we did give and that was the end of that.

    Now our kid is about to graduate from college. At the beginning of their freshman year we gave them all four years worth of the money we had saved for their spending money during college. They understood that it was up to them to budget effectively. They did such a good job that they are graduating with a full *year’s* worth of spending money still in the bank, and this is after they paid the full cost of an optional summer language program overseas (for which we offered to pay). Obviously someone else might have made very different choices, but I think the freedom to make their own mistakes was important in how they manage money today.

    Also: I think that if we had required them to save for something ten years out - like a car when still in elementary school - it would have been too abstract. That timeframe is just unimaginable for someone who still announces their age by including quarter-years.

    Have you ever heard of "The Opposite of Spoiled" by Ron Lieber (I think)?

    I think we will follow the philosophy described there when our kids are old enough to deal with money.

    You basically have three buckets that you ask them to think about:

    1. spend (now now now :o))

    2. save (for future use)

    3. share (i.e., charity)

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Related page: Allowance

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Our son, who just turned 6, has been receiving an allowance ($1.25/week) for about a year. It is not tied to chores but he must buy his own small toys and candy with it. His ability to save for something he wants has been pretty good (he bought 5 or 6 beanie babies) but sometimes he'll blow all his money on candy and snacks. He has, in my opinion, learned the value of money. We taught him how to read price tags and he can decide for himself what is expensive or inexpensive. He also realizes that he can collect $4 beanie babies faster than he can collect $5 beanie babies. My latest discovery is that he has also figured out simple arithmetic using fractions as a result. He knows that 2 quarters is a half, 2 halves is 1, and 4 quarters is 1, and can do subtractions in his head involving whole numbers and multiples of 1/4. (He had previously learned addition and subtraction of whole numbers using Jelly Bellys.)

Much to my surprise, I seem to have negotiated a good economy between my kids and myself. We have four, ranging in age from ~1 month to 11 years. We tried several different arrangements before arriving at our current agreement. For several years, I tried various ways to use incentives coupled with an allowance (making their beds, cleaning their room, etc., etc.). I seem to have made a mistake in making the allowance entirely incentive based. They constantly rebelled about cleaning their room, and frequently wished they had an allowance (they usually did no work which the allowance was to be based on).

Our current situation is that I grant each of them an allowance of $0.50 each week. We also have an agreement that I raise this figure when they show good cooperation cleaning, helping mom/myself, etc. Over the last several weeks the number has been $1.00 for each of the girls (our boy - at ~1 month is a little young for this yet). To this, I add opportunities to earn money for specific jobs around the house (washing dishes, mopping floors, clipping yard debris, raking leaves, stacking firewood, etc., etc.). I suggest these opportunities only when the kids inquire about earning money - I do not go out of my way to lure or cajole them into working. On the other hand, they know that when they see dad working in the yard, it is a good opportunity to spend time together (each of them seems to crave Dad's undivided attention (even if I am doing yard work at the same time).

I also added an element of savings. Each of the girls have a savings account with one of the credit unions to which I belong. At various times, they give me money to deposit into their account, and I do so. When they become intensely interested in a particular goal requiring money, we agree on a certain amount for them to contribute, and I provide the balance in matching funds. For example, my middle daughter wanted to study Violin. At age 7 1/2, she inquired, and we set a target of $70 for her to earn. By age 8 1/2, she had amassed the money, and we rented a violin at Ifshin's and engaged a teacher. By her working towards this goal, I am more satisfied that she really wants to study violin/music and am much more willing to put out the remaining funds.

The oldest has been working towards buying a mountain bike. She saved $145 of her money, and I will throw in the remainder to give her a budget of $300. Last weekend we rented a bike at Missing Link which was somewhat beyond our budget ($450) if purchased new, but allowed us to learn about braking, derailleurs, etc., and give us a benchmark. We looked briefly at REI later. She knows that she needs to stay within her budget to get the bike. The eldest also benefited from an experience where I agreed to a shopping spree of $100 for completing summer school (the schools in Albany are not quite what they are cracked up to be). She demonstrated ample skills at stretching the $100 to buy seven different garments (two sweaters, three blouses, and two paris of shorts) between Macy's and Nordstrom in San Francisco. Although you may think me very indulgent, I inquired whether she needed the garments she was interested in (as a way of gently suggesting she consider her needs rather than whims) at each juncture. I find it critical to demonstrate complete confidence in their judgment and taste. That is not to say she tried to go outside of what we would normally allow her to wear.

This seems like quite a ramble, however, I believe that teaching kids about money is an important and complex task. It is not only important to teach them how to earn and save, you must teach them the value of money as well.

Greetings! I am the same guy that submitted that long, boring (I hope not) post about my kids, their allowance, goals and spending. I somehow forgot the most appropriate part relative to the parent that requested the advice. I also have a 5 1/2 year old. My 5 1/2 year old receives an allowance as do her sisters. She usually saves it, although it often does not reach her piggy bank (she is easily distracted by the cat, the baby, etc.). This one has a goal of studying piano. We agreed on a $200 contribution from her. You might think this is excessive, however she has amassed $50 in approximately 6 months, and still has ample time to earn the rest in order to begin studying music before the other two started.

All three girls have embarked on several business ventures at many points over the last several years. I usually try not to discourage this, provided they do not try to comandeer critical family resources (computer, linens, etc.). As I recall, they managed to sell a hand-made greeting card to a neighbor for $1 once. That was their most profitable venture. They have also tried painting/selling rocks, lemonade and flowers. I think they are finding out how hard it is to set up and run your own business. But are developing some creativity and ingenuity along the way. Having been a math teacher for 10 years, I also try to sneak in questions about relative quantities, distance remaining to acheive their goal, etc.

My primary philosophy is to help my kids understand that money has many uses. Used wisely, it can do some incredible things. The oldest started asking about stock and investments. I think we will save that for another post.