Raising a financially responsible child is very important. In addition to that obvious practical application of understanding how to use, save, and invest money, consider the benefits of debt avoidance, personal responsibility, and added confidence.

As in all other aspects of parenting, the rule of thumb if you want to teach your children anything is to model the behavior you want them to learn! How comfortable are you with money!? What lessons have you learned?

So what are some tips to help you raise financially responsible children? Pay attention to the expert advice provided in this article.

• How do I Teach my Child to be Financially Responsible?
• How do you Raise a Smart Child about Money?
• What can Kids do to make Money?
• What Age should a Child know how do you Count Money?

How do I Teach my Child to be Financially Responsible?

From managing their allowance more wisely to saving up for that big-ticket toy or game on their wish list, use the suggestions below to share valuable money lessons with your kids.

Read Also: How to Accelerate the Achievement of Your Financial and Professional Goals

1. Teach them to budget

An allowance can be a great first step in showing your kids how to manage money. You might give money every week to the youngest children, at two-week intervals for preteens and monthly for teenagers. Gradually spreading out the timing will help your children understand the need to manage their spending.

2. Show them the value of saving

It’s only natural for money to burn a hole in the pockets of the youngest kids. But it’s important for them to discover the benefits of delayed gratification. If there’s a toy or a game they have their eyes on, suggest they forgo spending their allowance on ice cream or another immediate pleasure and instead save for a few weeks to make the bigger purchase.

3. Let them earn a little extra

You probably expect your kids to clean their room, help with the dishes and do other daily chores. But consider offering them the chance to make extra money by helping you organize the garage, washing the windows or taking on another job that goes beyond the routine. Getting paid for extra work will help instill good habits and give children more control over saving and spending.

4. Introduce philanthropy

Even when your kids are very young, you can speak with them about your charitable gifts. Talk to them about organizations they might like to support, then earmark part of their allowance for donations to those causes.

5. Create learning opportunities

If your children spend their entire allowance right away, resist requests for more money before their next allowance is due. Negative consequences can carry powerful lessons. If you talk with your kids about how to do better the next time around, they’ll start making smarter choices.

How do you Raise a Smart Child about Money?

Teaching your child about money can seem like an overwhelming task, but it’s made simpler when you break it down by age-appropriate activities and teachable moments.

Age 2-4

Fred Rogers (aka Mr. Rogers) once said, “Play is the work of childhood.” That same concept applies to teaching your young child about money. Turning lessons about exchange, value and savings into games will not only help your child learn these concepts before most of their peers, but will also help them enjoy the process.

Age 5-7

Around this age, parents start wondering about an allowance. It’s a sticky issue, but most experts say that it should be implemented as a way to teach money skills, not as a way to reward, punish or exert control over your child.

An allowance will help teach your child about wants versus needs, interest-bearing accounts, smart shopping habits and savings goals.

Age 8-10

Around age eight, you can start discussing the family budget with your child to further instill the concept of wants and needs. This is also a great time to introduce delayed gratification, percentage budgeting, and short- and long-term goals. Your child may also be interested in pursuing additional income.

Age 11-13

Preteens face a world of peer pressure. As a parent, there’s very little you can do about it. Let them use this time to make their own decisions with their money, even if it’s something you don’t agree with.

While they’re making their own decisions, reward savings with compound interest. Encourage budgeting and healthy money management skills by spreading their allowance out from once a week to once every other week. You also can introduce basic investing concepts at this time.

Age 14-18

When you’re dealing with a teenager, you’ll want to be sure to introduce money topics as discussions rather than lectures. Focus these discussions around concepts such as goal setting, saving, the functionality of credit cards and budgeting.

Getting a job can also teach your child a lot about money before heading into the real world. They’ll encounter taxes and the processing of their paycheck, whether via paper or direct deposit. It’s also good to propose a conversation about paying yourself first at this point. This skill can either help them save for retirement or pay for a part of their college.

What can Kids do to make Money?

While kids can’t get a normal 9 to 5 like adults, there are still several ways for them to start earning some cash through side hustles and making money online. Whether you’re a parent looking to help your child out or a youngster wanting to get a head start on your money-making endeavors, there’s no shortage of options at your disposal.

Modern kids and teenagers have a ton of technology at their fingertips. This opens up a world of opportunities that older generations never had. Gone are the days of having to open up a sidewalk lemonade stand or picking up a paper route. These days, you can make online in your spare time.

Learning how to make money as a kid is a great skill that can benefit you for the rest of your life. It gives you the chance to learn the value of a hard day’s work. Plus, you can finally afford all of those great things you want without having to beg your parents for extra money. Here are some of the best ways that you can make money as a kid.

1. Lemonade Stand

Arguably the first thing that you think of when imagining a young entrepreneur. To get started all you need is a pitcher of water, lemonade packets, plastic cups, chair, and table. Then it all needs to be placed somewhere that’s visible to drivers.

Generate more attention and add some creativity with a sign. Kids can also sell a food product like granola bars or popcorn to go with the lemonade. You can also have them skip the lemonade and opt for bottles of water and soda. On a hot, summer day that will go over well too as long as they are kept cold.

2. Put together a Garage Sale

Your attic might be full of old items from the past that you have kept around “just in case”. But that occasion hasn’t happened yet. Your kids could help organize all those unwanted items up for a garage sale. 

This activity will also develop their project management skills in the process. You clear some much-needed space, get a family activity, and they make some cash.

3. Take Online Surveys

Companies are always seeking feedback on how to make their products and services better. Why not get paid for your opinion? Kids with a smartphone can do these too. It takes a while to make any money. Two survey services you can start with are Swagbucks and Survey Junkie. 

4. Lemonade Stand

Arguably the first thing that you think of when imagining a young entrepreneur. To get started all you need is a pitcher of water, lemonade packets, plastic cups, chair, and table. Then it all needs to be placed somewhere that’s visible to drivers.

Generate more attention and add some creativity with a sign. Kids can also sell a food product like granola bars or popcorn to go with the lemonade. You can also have them skip the lemonade and opt for bottles of water and soda. On a hot, summer day that will go over well too as long as they are kept cold.

5. Put together a Garage Sale

Your attic might be full of old items from the past that you have kept around “just in case”. But that occasion hasn’t happened yet. Your kids could help organize all those unwanted items up for a garage sale. 

This activity will also develop their project management skills in the process. You clear some much-needed space, get a family activity, and they make some cash.

6. Take Online Surveys

Companies are always seeking feedback on how to make their products and services better. Why not get paid for your opinion? Kids with a smartphone can do these too. It takes a while to make any money. Two survey services you can start with are Swagbucks and Survey Junkie. 

7. Babysitting

If your kid is old enough to babysit, that is a great way for them to make some extra money in their free time. You can help by spreading the word with your friends and acquaintances. If you have neighbors that seem to have kids around the age that would be good for them to babysit, have them introduce and offer their services. 

8. Pet Sitting and Dog Walking

Pets are treated as family members so caring for them is a top priority. When an owner is taking a vacation or has a schedule that makes it difficult to provide the attention their pet needs, they’re willing to pay someone to help. Owners may need help with taking their dog out for regular walks or checking in on them while they are away.

It’s an enjoyable way for a kid to make extra money. Kids can find clients through similar methods used for finding babysitting gigs.  Care.com and Nextdoor are two websites/apps that could be helpful in spreading the word digitally. 

9. Flipping Products on eBay

This is something that your young budding entrepreneur will need some help from you on. To start this business opportunity you need a little bit of initial investment to purchase items. Start with a small budget of $20 to $50 to find things at flea markets, thrift stores, and garage sales for items that have the potential to make three or four times more what you paid for them. 

Help them do some research on what type of items to look for. Compare similar items on eBay to find what they are going for. Then it’s a matter of finding them, fixing/cleaning them up, and submitting a listing. Sit back and wait for bids to close. This can all start happening in a matter of a few weeks.

10. Selling Arts and Crafts

If your kid is particularly crafty, they can turn that skill into an income opportunity. The craft could be bracelets, necklaces, artwork, clay creations, keychains, and basically anything they want to create. Help them with pricing the crafts so that it covers their costs for creating it. Farmer’s markets, Etsy, and fairs are good places to set up their crafting shop.

11. Lawn Mowing

Another one of those classic money-making opportunities for kids is mowing lawns. It’s a perfect way to make money over the summer. They need a lawnmower and weed wacker to start. Neighbors are their built-in potential client base. 

Have them walk around the neighborhood and knock on doors, letting them know about their service. Flyers could also be useful to hand out or post around the area. 

12. Doing Chores Around the House

Do you have extra chores around the house that you’d love to take off your hands? Work out a deal with your kid to handle some more responsibilities around the house in exchange for cash. This could be daily or weekly chores like taking out the trash when it’s full, vacuuming the house and cleaning the shower. Or it could be one-time projects such as cleaning out the garage or attic. 

13. Set Up a Car Wash

Everyone likes to keep their car looking good. Your kid can go around the neighborhood to let everyone know about their service. A busy street or nearby a grocery store or other businesses might also be a good way to set up shop. A sign will help attract the attention of those who drive by. Be sure to check to make sure if they do this in a business area that is ok first. 

They will need some equipment such as a bucket, soap for cars, and rags to get started. Additional services like car detailing could be upsold for some extra cash too. 

14. Recycling

In certain states, aluminum cans are worth up to 5 cents to recycle. You might purchase soda or other canned drinks for your family. Outside of the home, you can usually find them discarded along the streets or outside sporting fields. Your kid will be doing their part to clean up the environment while making a little extra pocket money at the same time.

15. Farmers Market

If you have a backyard in your home, growing vegetables could be a hobby and money-making opportunity for your child. Popular vegetables like tomatoes, green beans, and cucumbers will generally sell fairly easily. The local farmers market is an inexpensive venue for your kid to sell their grown vegetables. They can also be pickled and jarred for an even higher price and keep unsold vegetables from going bad.

16. Sell Baked Goods and Other Food Items

Technology has changed the traditional way that kids could sell their baked goods. They can reach their own website easily as a storefront for their cookies, cupcakes, and other items. A website is an inexpensive expense and PayPal makes it easy to process cash transactions. 

Promotion can be done via social media through friends and family. Otherwise, they can also go more to the old school route of selling to classmates, neighbors, and others. 

17. Start a YouTube Channel

You can never tell what will go viral nowadays. YouTube stars have been made by kids opening new toys after all. If your kid has an idea or concept, help them flesh it out and have them give it a shot. 

18. Building Websites for Others

WordPress is a simple platform to create a website. Most businesses don’t need anything that complicated to set one of these up. Think about how many times you will hear about a business and you try to Google it. If they don’t have a website, it’s almost like they don’t physically exist. 

A kid with some knowledge of building a simple web platform can do the work for a lot of money. If your kid is interested in web design and development, there are many online resources where they can learn about how to build one. That skill can then be used to help others who don’t want to do it themselves. 

19. Cleaning Service

While this is not a job that is particularly enjoyable, it’s a great way to make extra money. Many people don’t have the time or find it difficult to upkeep a home. Kids can easily make over $20 an hour to clean other people’s homes.

It might take some extra convincing at first so they might have to clean for free their first job to start building the trust of their clientele. Teach them how exceeding people’s expectations will turn that happy customer into one that tells all their friends and family.

20. Sell Their Photography

Kids who enjoy taking pictures could work on their craft by selling their photos to photography sites. iStock and Shutterstock. It’s not likely they can get professional paid gigs for taking pictures at weddings, newborns, senior pictures, etc. but they might be able to work with one as their assistant. They will learn about techniques and how to position shots for a good outcome. 

What Age should a Child know how do you Count Money?

Children begin to form basic understandings of money as early as the toddler years, when a $20 bill falls out of a birthday card and everyone says, “Oooh!” A preschooler might hear his parents talking about paying the bills or how much money is needed to buy a certain item.

These early experiences with money are important and can contribute to future financial success, but learning to count money comes a bit later.

Counting money requires several prerequisite skills and basic math understandings that build upon one another in preschool and kindergarten. As their understandings grow, most children are ready to count money by first or second grade.

Basic Understandings

Most children are exposed to coins in preschool or kindergarten. They learn that coins are different sizes and colors and they have different names and values. Young children spend time sorting dollars and coins into like groups, identifying coins and dollars and learning their values.

At this stage, most kids will count all coins or dollars by ones because they aren’t developmentally ready to skip count. Children in preschool and kindergarten should also learn that money is used in exchange for goods or services.

Identifying Coins and Values

Once children become familiar with the different types of currency, they can delve a little deeper. The second stage of learning to count money involves being able to identify different coins or dollars and name their values. This takes time and practice, as many kids get thrown by the fact that dimes are worth more than nickels and pennies, even though they are smaller in size.

Children can also work at making equivalent groups of coins. For example, ask your child to show 10 cents with pennies, nickels or a combination of both. Increase the difficulty as your child demonstrates her understanding of easier amounts first.

Skip Counting

In order to count money, children must be able to skip count by fives, tens, and in increments of 25 up to 100. This is a difficult skill to master and may take a couple of years of practice. Many children are exposed to skip counting in kindergarten and first grade but don’t quite master it until second grade or later.

Since quarters can be the hardest to grasp, begin by teaching your child to skip count by fives and tens. Give your child a small group of coins, including a couple of pennies, dimes and nickels. Teach him how to start with the coin of the highest value and count on. Add quarters into the mix once he has mastered the other coins.

Money Counting Strategies

Once children learn the basics of coins, values, skip counting and counting on, the sky’s the limit. Show your child how you would count a pile of money, then ask her to count it and explain her thinking. As long as the end result is the same, a different method of getting there is fine.

If your child struggles with a particular counting concept, take a step back and offer more opportunities for simple practice before pressing on. Use real-life opportunities to teach your child about money whenever possible, as this can be a real motivator to kids.

Money ABCs

Money is any medium of exchange that can be used to pay for goods and services and to measure the value of things. Currency is a term for a country’s money in circulation—that is, coins and bills.

The two main skills that children need to know when it comes to money—and the earlier, the better—is being able to identify money and being able to tender money and make change. They probably won’t learn these skills in school, either because the primary focus in most schools is math, not money.

One expert suggested that kids can start to learn about money as soon as they’re old enough to know not to put it in their mouth—you know your child better than anyone, so you know when you can start.

Certainly, by the end of the first few grades in elementary school your child should have mastered counting money and making change. If your child is older or can already do these tasks, you can move on to using checks.

Identifying Money

Money comes in different shapes and sizes—it comes in metal and in paper. Different units of money have different values that can be used to pay for different things. Size doesn’t count—it’s the denomination of the money that matters. Adults take these simple facts for granted, yet they’re precisely the things that prove problematic for children.

Financial Building Blocks

Coins in circulation today are the Lincoln penny, the Jefferson nickel, the FDR dime, the Washington quarter, and the Kennedy half-dollar. The Susan B. Anthony dollar coin is still in circulation; starting in 2000, the Sacajawea dollar coin will start to circulate.

Bills in circulation today include the $1, $2, $5, $10, $20, $50, and $100 bills. Distribution of bills in denominations of $500, $1,000, $5,000, and even $10,000 ceased back in 1969.

The important concept to convey to your child is that money is based on the dollar. Coins are merely fractions of that unit; bills are multiples of that unit. One hundred pennies, or one-cent coins, make up a dollar; Twenty nickels, or five-cent coins, make up a dollar; and so on.

Understanding that money is based on the dollar unit allows you to explain about equivalents: that 10 pennies will buy the same as one dime; that four quarters will buy the same as a dollar bill. Ask your child to think of how many combinations of coins might equal 25¢ (for example, three nickels and one dime). The answer: 14 combinations (which includes simply using one quarter). You can repeat this game with other amounts, such as 50¢ or a dollar.

Piggybank on It

No matter what your age, it’s always important to count the change you’re given. Doing this is the same as having made the change yourself (you have to check the change-maker’s math). It’s also a good practice to announce the amount of money you’re tendering (for example, “here’s $20″) so that the change-maker won’t short you on the change.

Making Change

The word change refers to the loose coins you have in your pocket. It also means the difference between what something costs and the money that’s been tendered to pay for it. Every adult has had the experience of facing a teenage cashier who can’t make change.

Like teenagers who can’t tell time because of digital watches, they can’t make change because of today’s cash registers that tell them what the change should be. In effect, these cashiers never learned the simple task of making change.

If you don’t want your child to be that teenager, it’s up to you to make sure that the idea of making change doesn’t become a lost art. Making change can be easily mastered once your child is familiar with the different coins and bills, and can count in multiples of these pieces of money.

As with tying shoes, there are different ways to accomplish the same thing. The easiest technique for making change is counting forward from the amount spent to the amount tendered. For example, if an item cost 68¢ and the amount tendered is three quarters, or 75¢, then count forward with coins from the 68¢ cost, as follows: 69, 70 (with a penny each), and 75 (with a nickel). In other words, the change should be 7¢ (two pennies and one nickel).

An alternative technique is the subtraction method. Here, subtract the cost of the item from the amount tendered. Repeating the earlier example, subtract 68¢ from 75¢, which is 7¢. Then count out the coins to equal 7¢ (two pennies and one nickel).

Kids watch the way we react to certain things. What you think is a simple statement said in passing could be internalized by your children and used as a catalyst for future attitudes and habits.

Read Also: How you can Improve Your Future Financial Success

One area in which this has life-long repercussions is finance. In fact, you may not even realize that you’re projecting some of your bad financial habits onto your kids long before they open their first bank account.

But in acknowledging and dealing with your faulty habits, you can save your children from the same mistakes and improve your financial situation at the same time.

Finally

Teaching your children about money at any stage is going to take time on your part. It won’t always be easy. But if you want your children to know how to successfully manage their money when they get older, taking the time now will be worth it.

One of the best ways to teach your kids about handling money is to give them a chance to make some of their own, we have also provided some idea for children to make money for themselves.