If you speak English in your home, your kids are not likely to come out speaking Italian. Kids learn through observation and imitation. And they don’t miss a thing. Children are shaped from the very beginning of life by the way their parents live. They are ever-attentive witnesses of grown-up behaviors. They take their cues from what they see and hear.
Want your kids to grow up with healthy attitudes about money? Start living the way you want them to become. Let your kids regularly catch you in the act of living financially responsible lives, and you’ll be on your way to raising financially responsible kids.
Recently, I ran across an article titled, “10 Ways Warren Buffett’s Frugal Habits Can Save You Money.” No. 9 on the list? “He uses cash, not credit.” While most of us these days prefer the convenience of a credit card for everyday purchases, Buffett uses hard cash. You should, too. For kids and adults alike, cash is real; plastic is just a stand-in for the real thing. It’s human nature to be more casual, even reckless, with plastic—more cautious when having to peel off $20 bills to pay the tab.
Cash might sound old-school, but relying less on your credit card can stop you from spending money you don’t have. And looking like Warren Buffet isn’t a bad thing.
You really cannot start too early modeling healthy money attitudes for your kids. Here are 20 ways you can start right now to raise financially responsible kids even if still toddlers:
1. Let them observe that you have money and you take good care of it.
2. Let them see you use money as an ordinary and normal part of life.
3. Make sure they catch you being generous with others and sharing what you have.
4. Tell your kids stories about the ways you have made do with what you have, choosing rather to save, not spend.
5. Allow them to see you deposit money in the bank.
6. Let them see the way you pay for groceries with cash.
7. Teach them that money is important in our lives because we can exchange it for things we need and want.
8. Talk about money as casually as you talk about other things, like sports and laundry.
9. Use coins to teach your preschoolers to count. It’s effective and acknowledges their curiosity about money.
10. Talk about the different shapes and colors of items in the store. It gives little ones something to do instead of wanting everything they see.
11. While a passenger in the grocery cart, allow your little one to hold the coupons or the list. Talk about finding the best value.
12. Say, “We don’t choose to spend our money that way” more often than you say, “We can’t afford it.”
13. Remember preschoolers are listening and learning from everything they see you do and hear you say.
14. Use coins to teach the different denominations. Three- and 4-year-olds can learn to put all the pennies into one cup, the nickels into another, and so on.
15. Visit the library and park with your preschooler more often than the market or mall.
16. Give rewards of hugs and praise, not money. Creating the expectation of cash payment at every turn is a habit you’ll regret in adolescence.
17. Monitor television time and opt for noncommercial viewing and videotapes when possible.
18. Let preschoolers participate in household chores to enjoy the security of belonging, not to get paid.
19. Intervene between advertisers and your kids. Preschoolers can’t always tell when the television show ends and the ad begins.
20. Make sure your children grow up knowing that all good things are a blessing from God.