Kidpreneurs: 10 Tips for Kids and Money
The bright, sugary cereal box is just at eye level. The bold blue, red, orange, pink and yellow jump out
and grab the eyes. The free DVD inside puts the situation over the top and immediately the box is off the
shelf and in the hands of your child. And then the most feared words in history are spoken, “Mom, can I
have this?”
We live in a “Want, Therefore-I-Get” society. Our children completely understand that concept. Just zip
the plastic card through any machine and you get what you want! From a bag of fries at McDonalds to an
iphone from a vendor machine, anything is possible with THE CARD. But, what are we really teaching our kids? We
know that actions speak louder than words. We are teaching them to buy with credit, that everything
comes easily and that you can have anything you want.
We must assume that those thoughts are a direct reflection of our economy today. In the last 15 years
credit card debt has risen from $3,000 per household to almost $10,000 per household. According to
“BusinessWeek,” there are 64.6 people per credit card in India, but five credit cards per person in the
United States! Home equity is at its lowest point since 1950 (below 50 percent), and, for the first time since
the great depression, the savings rate is in the negative. So, the next time your kids say “I want,” try these
10 tips to teach your kids about money:
1. Just say no! If you have young children, just say no! They don’t have to have everything they see! We
live in a society of instant gratification. Teach children how to wait and earn what they want.
2. Teach them to procrastinate on purchases. Half the things we want are impulse desires. Make your
child wait a week and see if they still “have to have it.” This will teach them to think rationally about
purchases and consider each decision thoroughly.
3. Create jobs for your children at an early age. Make them EARN an allowance. This is a good habit to
start and can last a lifetime.
4. Create a budget. You can’t get ahead in the money game if you don’t know where the money is
going! Save first, give to others second, spend third. Allowing your children in on this process will
also help them appreciate where money goes and what it takes to run a household.
5. Make them question their spending. Do you really need that purse? Or those concert tickets? Or that
new video game? Have them weigh the pros and cons of the purchase versus the money that could
be saved and used towards something in the long run.
6. Help them to pay themselves first. Be an automatic saver. Make them immediately save a portion of
their income. Open a savings account for them with a small minimum and take them to the bank with
you. Have them put part of their allowance or earnings away each month. They will see how
compound can interest work FOR you, not AGAINST you!
7. Teach them to understand the power of compound interest. It is “the most powerful force in the
universe,” according to Albert Einstein. Compound interest is how you can become a millionaire by
only investing $25 a month over the course of a lifetime. The goal: get higher interest rates, and
double your money faster! This creates great incentive to save that money instead of spending it right
away.
8. Explain how compound interest can work AGAINST them. Have them pay back “loans” from
friends or family quickly. Explain how banks charge a fee called “interest” on money they lend. Pay
off your debt to those who’ve lent money so that you aren’t paying unnecessary fees.
9. Have them read about the rules of money. Education is the key. There are thousands of great books
for learning about what to do with money. Instead of playing with video games, educate! We suggest
ABCs of Making Money for Teens by Denis Cauvier & Alan Lysaght.
10. Give back. Teaching children to give back is so important. Be an example and donate money and
share this experience with your kids. Help them research different organizations so they can find a
cause that they truly have interest in. Giving is what truly makes you happy anyway, not money!
Geoff & Kristin GembalaWORLD
APPRECIATE
The bright, sugary cereal box is just at eye level. The bold blue, red, orange, pink and yellow jump out
and grab the eyes. The free DVD inside puts the situation over the top and immediately the box is off the
shelf and in the hands of your child. And then the most feared words in history are spoken, “Mom, can I
have this?”
We live in a “Want, Therefore-I-Get” society. Our children completely understand that concept. Just zip
the plastic card through any machine and you get what you want! From a bag of fries at McDonalds to an
iphone from a vendor machine, anything is possible with THE CARD. But, what are we really teaching our kids? We
know that actions speak louder than words. We are teaching them to buy with credit, that everything
comes easily and that you can have anything you want.
We must assume that those thoughts are a direct reflection of our economy today. In the last 15 years
credit card debt has risen from $3,000 per household to almost $10,000 per household. According to
“BusinessWeek,” there are 64.6 people per credit card in India, but five credit cards per person in the
United States! Home equity is at its lowest point since 1950 (below 50 percent), and, for the first time since
the great depression, the savings rate is in the negative. So, the next time your kids say “I want,” try these
10 tips to teach your kids about money:
1. Just say no! If you have young children, just say no! They don’t have to have everything they see! We
live in a society of instant gratification. Teach children how to wait and earn what they want.
2. Teach them to procrastinate on purchases. Half the things we want are impulse desires. Make your
child wait a week and see if they still “have to have it.” This will teach them to think rationally about
purchases and consider each decision thoroughly.
3. Create jobs for your children at an early age. Make them EARN an allowance. This is a good habit to
start and can last a lifetime.
4. Create a budget. You can’t get ahead in the money game if you don’t know where the money is
going! Save first, give to others second, spend third. Allowing your children in on this process will
also help them appreciate where money goes and what it takes to run a household.
5. Make them question their spending. Do you really need that purse? Or those concert tickets? Or that
new video game? Have them weigh the pros and cons of the purchase versus the money that could
be saved and used towards something in the long run.
6. Help them to pay themselves first. Be an automatic saver. Make them immediately save a portion of
their income. Open a savings account for them with a small minimum and take them to the bank with
you. Have them put part of their allowance or earnings away each month. They will see how
compound can interest work FOR you, not AGAINST you!
7. Teach them to understand the power of compound interest. It is “the most powerful force in the
universe,” according to Albert Einstein. Compound interest is how you can become a millionaire by
only investing $25 a month over the course of a lifetime. The goal: get higher interest rates, and
double your money faster! This creates great incentive to save that money instead of spending it right
away.
8. Explain how compound interest can work AGAINST them. Have them pay back “loans” from
friends or family quickly. Explain how banks charge a fee called “interest” on money they lend. Pay
off your debt to those who’ve lent money so that you aren’t paying unnecessary fees.
9. Have them read about the rules of money. Education is the key. There are thousands of great books
for learning about what to do with money. Instead of playing with video games, educate! We suggest
ABCs of Making Money for Teens by Denis Cauvier & Alan Lysaght.
10. Give back. Teaching children to give back is so important. Be an example and donate money and
share this experience with your kids. Help them research different organizations so they can find a
cause that they truly have interest in. Giving is what truly makes you happy anyway, not money!
Geoff & Kristin GembalaWORLD
APPRECIATE