Christmas is the perfect time to teach kids about budgeting. Whether you’re shopping with a preschooler or a teen, make gift buying a chance to learn about money management.
Kids love being involved in holiday preparations. This year, in addition to baking and decorating with your kids, make shopping part of the family routine. Take this as an opportunity to talk about money management and the ways gifts fit in with your family’s traditions. When you focus on shopping for loved ones, your kids won’t notice the subtle budget lessons and math practice.
Talk about shopping first
While you want to teach money management, you don’t want to focus too much on money during the holidays. Before you begin shopping for holiday gifts with your child, talk about the tradition of giving gifts and what it means in your family. Emphasize the spirit of giving and de-emphasize the commercialism of the holiday. Ideally, your children should learn that it’s truly the thought that counts. Even teens can spend time creating homemade gifts in addition to shopping for presents at the mall or online.
Teach age appropriate lessons
Preschoolers won’t be able to grasp the full concepts of money management and budgeting, while teens may already have bank accounts and check cards. Tailor your holiday budgeting lessons to your kid’s age. For example, let younger children see you paying with cash so they can understand that a transaction is going on. When teaching older children, take time to sit down and go over your shopping budget on paper or on a spreadsheet. Encourage young children and teens to save throughout the year.
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Talk about advertising and comparison shopping
Kids love browsing big toy catalogues during the holiday season. Next time your child eyes a toy in a catalogue or sees a commercial on television, talk about advertising in an age appropriate way. Discuss using advertising as a way to find the best prices, as opposed to letting advertising dictate what you decide to purchase. Make a game out of comparison shopping for the best deals. The goal is to empower your children as shoppers and encourage them to notice the persuasive nature of advertising.
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Give kids a shopping allowance
When shopping, kids practice math skills and decision-making skills. Try giving elementary school kids a modest shopping allowance in small bills. Visit a discount store where kids can pick small gifts for family members. Give your child as much freedom as possible, only stepping in to answer questions. Older kids and teens can online with your guidance. Remind kids of hidden expenses like postage and wrapping. Encourage older kids to track spending carefully and the habit just might carry into the New Year.