Money management is a basic life skill, but all too often it goes untaught. Learn how to teach kids about money through the program MoneyTime.
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Teaching kids about money is more important than ever in our world of online banking and credit card purchases! It’s a daunting subject for parents, because all too often we ourselves never received any formal financial literacy education.
That’s why I jumped at the chance to review MoneyTime, a new financial literacy online program for children.
How to Teach Children About Money
I have written before about teaching kids money management; here are five everyday ways we teach our children about money. I’ve also got a great post for adults on simple ways to save money. Today’s post focuses on teaching children financial literacy.
#1 Teach Them How Money Works
You can’t manage money without understanding how it work, but money is complicated!
This is where a program like MoneyTime is gold! Here’s an overview of how the program works:
And an introduction to the program you can share with your kids:
Our Experience Using MoneyTime
I created MoneyTime accounts for my two older children. My 12-year-old son enjoyed the program, and learned a ton! My 14-year-old found the information useful, but felt like the presentation was a little “young” for her tastes. She likes to be sophisticated.
I really liked what I saw, watching my kids work through the program, reading the parent emails, and logging in and going through the program as my child.
This program is very thorough! It teaches the basics, like how a savings account works.
Kids have the option of investing in education for higher future earnings.
They also get to see how different career choices lead to different earning potential.
But that’s only the beginning! They learn about building resumes, applying for jobs, and paying taxes.
Then, as the money begins to roll in, they learn about managing that money. They practice budgeting, managing credit, and using different types of bank accounts.
Then kids learn about borrowing money and repaying loans. They decide whether to rent or buy property and how mortgages work.
The program also teaches investing and business in a huge amount of detail. In the end, you earn access to MoneyTime’s Top Ten Money Tips.
Honestly, I need to go all the way through this program, because there’s a ton of info I wasn’t taught. And I’m sure I’m not the only adult!
How Does MoneyTime Work?
MoneyTime is a subscription program. They have packages for 1 child, 2 children, and 3-5 children. You can also email them if you need subscriptions for more than 5 children.
On to More Tips for Teaching Kids About Money at Home!
I do wish you could jump around topics instead of earning your way through them. My kids already understand the basics of money management, and they found the early modules boring.
#2 Discuss Everyday Expenses
It is easy for kids to forget that so many things we use every day cost money. When our power bill comes, I show the kids how it is calculated, and we talk about what things in the house use up power. We talk about why some things are expensive while others are not – supply and demand, fair wages for workers, the cost of materials, the construction process, and other details. We go through a similar process when we go grocery shopping.
#3 Let them Practice Controlling a Budget
Once they’ve practiced controlling funds virtually in MoneyTime, let them try budgeting in the real world.
Giving kids a budget for back to school shopping is a great way to teach kids about controlling a budget!
My kids also learn to control their budgets by practicing prioritizing wants and needs using money that they earn mowing lawns and folding and putting away laundry for me.
When we travel, I give my kids a budget for lunch or dinner and they help me pick out food to eat. I am in charge of balancing our household budget, and I sometimes go over it with the kids as well so they can see where the money comes from and where it goes.
I highly recommend including some sort of charitable giving in budgeting exercises – you can pick out a few cans or boxes of food to donate to your local food pantry while you are at the grocery store (tip: bonus points for picking out things that are easy to cook and easy to open), and school supplies to donate to a school drive or local homeless shelter.
When we balance our family budget, we always set aside a portion of our income for charitable giving, and the kids have some say in where that money goes. My kids also set aside a portion of all the money they earn for charitable giving. Thinking of others is a great way to help all of us – adults as well as children – balance out wants and needs – and it feels great to make a difference!
Now, onto my top tips for teaching kids about money in real life!
#4 Let them Handle Physical Money
Virtual money is hard for even adults to control. Seeing and feeling real money is a great way to make kids more aware of how much they are spending. You can also use coins to teach kids about history. If you have coins from other countries, they are a great way to teach your kids about the world!
#5 Use Pretend Play to Teach Kids About Money
Buying, selling, and using money in other ways in pretend play is a great way for kids to practice using money in a safe environment! My kids are always making little shops and designing their own currency. They learn a lot about saving and spending this way!
IMPORTANT: Talk About Money Mistakes
Kids LOVE hearing about mistakes parents make, and since they tend to remember these stories pretty well they make for excellent teaching opportunities!
I have spoken with my kids about things I would have done differently – from paying down student debt very aggressively only to borrow money at a higher interest rate for a home repair (the importance of maintaining a decent savings cushion) to buyer’s remorse.
How are you teaching your kids about money and helping them develop personal financial literacy?
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