Focus on Education Help Your Child to Understand Money

When I was seventeen years old, my father taught me an invaluable lesson about money. I was constantly bugging him for money to buy this and that never mindful of what money really is and how hard it is to earn. Like a good parent he did the best he could to buy them for me. Many times I would plead for an item with a promise that I would pay back the money.

One day he called into the living room and said, “Tony, I am going to put $300 in this desk drawer for you to use as you desire. You are always promising to pay me back, but I never see a cent of it. So the $300 is yours to use as you want to. If you don’t replace what you take, back into this drawer, when it is gone that is it. No more loans. Ok?”

I jumped at the thought that I had $300 to spend whatever way I wanted to. Immediately I started to buy things. Soon the money got less and less in the drawer. The thought of ever paying it back never entered my mind. Within a short time the drawer was empty. Back I went to my father and asked again for money. He shrugged his shoulders and asked if I had replaced any of the money I had taken out of the drawer. I looked down and replied, “No.”

My father quietly explained that money must be earned and saved if one is to enjoy it. From that day on I worked hard to repay the money back into the drawer. My father by a simple example taught me that money is a precious commodity to be earned and used wisely. But why this story? What are you doing to help your child to understand the fascination and necessity of money?

Sit down and explain to your child why work is a necessity of life. Show him how the money you and your wife bring home affords everyone the necessities and the luxuries each enjoys. Assign specific chores around the house and pay him accordingly while encouraging him to save a portion of it. Perhaps he can get a part-time job.

When the child is old enough to understand, accompany him to the bank and help him open his own checking account. Show him how to write a check and explain its function. Teach him the difference between a checking account and a saving account. Explain how interest works.

Have your child shop with you. Show him prices of food and clothing. Let him stand at the checkout counter and watch the tally of prices. He needs to see what food items cost and the expense of running a house. Explain that the food you are purchasing is the result of work and planning with money earned. In this manner, he will gain first-hand experience at distinguishing between wants and needs, and between prices and value.

This is the tax season–an excellent time to have your child join you as you prepare your taxes. Explain taxes and how the money you pay is used in the government. Let him see you pay the utilities, phone, and television bills. If you are a handyman and do many of your own repairs around the house, show him how much cheaper it is than to hire a repairman.

There are many other ways to helping your child become aware of money. The earlier you begin making him aware of it, its necessity, and proper handling, the sooner your child will appreciate money. It’s a vital part of living.