Teach Your Child About Money Early

All the way up until the second year of college, I knew practically nothing about how to handle money. The examples I saw growing up were usually living paycheck to paycheck, I didn't see my parents do a lot of savings, or much of anything with money. I just did not get a financial education when I was at home. This is really a problem, because it happens far too often. The children of today are tomorrow's small business owners, and many of them will go through many years of financial struggles because they do not know the basics of personal finance and how to adopt them in their financial lives. Here are some tips and tricks to teach your children about money so they have a base to build off of when they go out into the real world.

If your child can count all the way up to 10 or 20, there's a good chance they are ready to begin understanding about money. Your children will learn by your actions, so do smart things with money and show your children that you are doing it. Take them when you go to the bank and tell them what you are doing and why you are doing it.

The best way to do this is with the jars method. Get three jars, and label one giving, one saving and one spending. Give your child a nickel for each jar every time he or she does some work, such as cleaning up his or her room. When the spending jar gets full, you can put some of that money towards a toy. When the saving jar gets full, you can open them up a savings account. When the giving jar gets full, you can tell them all the good ways they can use that money to help other people.

As your child grows older, you will want to increase this nickel to a time, then a quarter, then a dollar, and then five dollars or so once they hit their mid teens. Establishing these patterns early will help reinforce to your child that works equals money, and that you can do three things with money, give it, save it, or spend it, and that you should do some of all three. Sadly, there are some senior adults who still have not figured these basic concepts out.