Teaching Kids about Money Management

The minute she started costing me money is the minute I started her savings account.

That initial trip to the doctor verified my pregnancy and caused an epiphany: This baby would be the biggest expense of my life. The span between her first month in utero and her medical degree would cost far more than any house.

So I began saving for her college. And I also set up a little Moolah Account for her – just $25 a month for every month of her life. And since her life began in my womb, the Moolah Account began that first month of gestation. I recommend this for any new mom and baby. It has led to a childhood of wonderful memories and meaningful lessons.

I took my baby to the bank, every month. First in my arms, then on my hip, then by the hand. “Look!” I’d exclaim. “it’s the bank teller lady! She’s going to put this $25 into your savings account! Saving money is good. Smart people save money!”

My daughter soon realized she had a fan club. The bank tellers heard her first baby babble. They witnessed her first steps as she walked all by herself to the counter. Throughout her first, second and third year they watched her fuzzy bald head grow locks of long hair. She received praise for her growing savings account balance.

She learned to love that bank!

Soon, she began earning money for chores. It did not matter that she move more crumbs around than she wiped up. It mattered that she tried her best. And it mattered that she saved a little bit of what she earned for those important trips to the bank. For along with every $25, she began adding a quarter. Or 50 cents. Sometimes a whole dollar!

Soon she was mowing the grass and washing the car. She learned about tithing. 10% went to Sunday school. She was helping missionaries go to South America! 10% went to savings during our monthly trips to the bank. And 80% she kept for herself. Keeping up with the percentages helped her with Math. It also helped her with reasoning and accountability.

Then came the Nintendo DS. My child wanted one. Really, really wanted one! “Well, buy it!” I told her. “But mom, I don’t have enough money!” Hmmmm. “Honey, you keep 80% of everything you earn. Where does your money go? It seems to me that you spend it on stuff. Just stuff. Stuff that ends up on the floor. Stuff you lose or give away.”

“But mom …”

“But nothing. A Nintendo DS is a BIG expense. I don’t have $150 just laying around. It’s your choice – you can squander money or you can put it in a Nintendo jar.”

“A Nintendo jar?”

“Yes, like a piggy bank.”

So she worked and earned. And instead of squandering 80% of everything she earned, she set it aside. Her pride was unmistakable as we walked into Best Buy and came out with a pink Nintendo DS. She had done it! It took six months, but she had earned it all by herself.

Parents, I can’t stress how important it is for your child to save and earn, earn and save. The old saying is true: Give them a fish and it feeds them once, but teach your child to fish and they learn self-sufficiency. Make it fun! Make it count! Let your child see your save … even if it is just $25 a month in a Moolah Account!