Dollars & Cents for Youth
Lesson 1 - Study Course For Parents
Main Ideas
• Key Words
• Money Talk
• How are You Doing? Rate Yourself
• What Parents Need to Know
• A Little About Your Child
• Things to do
• Lesson 2
• Value Voting
Main Ideas
- Money management is a skill that must be learned.
- Parents play an important role in teaching children how to manage money.
- Children need to begin learning how to manage money at an early age.
- All family members need to be involved in family money management.
Key Words
Money Management - Knowing how much money you have and then planning how to spend it to get what is important to you.
Goal - This is your objective - what you want or need. It is the thing you are working for. For example, a new car, a new bicycle, going to college, taking dancing lessons, and so on.
Values - These are feelings that guide you in choosing your goals. They are what you use as standards for making judgments. Values are what you believe is right and good. For example, honesty, trustworthiness, and so on.
Comparison Shopping - A way to be a better shopper. Check out the item you want to buy in different stores. Look for the best buy. Keep your eyes open for bargains.
Money Talk
"Dollars & Cents for Youth" has been developed so that you might gain skills and become more confident in teaching money management to your children.
Children are like sponges. From infancy on they absorb what they see and hear around them. They get their ideas about money from you as parents. So it is logical that the home is the best place for teaching children about money. An excellent way to teach the basics of money management is through family participation. Children can be brought into family discussions about money to the degree that they are capable of understanding. Whether they are told the exact amount of family income in dollars and cents is a decision each family must make for itself. If the family income is irregular or the family has suffered a financial setback, it may be helpful to share this with the children so that adjustments in spending can be made. If children understand some of the money problems a family faces, they will be more willing to cooperate with the family's spending program.
Teaching children the value of money without emphasizing it too much is a challenge to parents. It is best to start the educational process as early as possible. Usually the 4- or 5-year-old child is ready for simple money experiences.
How Are You Doing? Rate Yourself. . .
Use the following questions to check your progress in helping children manage money.
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Does my child have some money to manage without my interfering? |
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Have I helped my child set up a plan for spending? |
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Have I explained why and how one saves for future goals? |
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Do I avoid using money as a reward or punishment? |
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Does my child share household chores as part of his/her responsibility as a family member? |
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Do I help my child find ways to earn extra money suited to his/her age and ability? |
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Do I set a good example in being truthful about money matters? |
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Have I increased my child's financial responsibilities as he/she has matured and gained experience in handling money? |
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Does the child participate in family financial planning so that he/she sees the relationship between individual income and that of the family? |
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"Yes" answers indicate that you
make efforts to help your children gain money management skills. "No"
answers suggest that you may need to give more help to better prepare your
children for their role as money managers. This study course will offer ideas
and suggestions which you can use to improve your skills and in turn help your
children improve their money management skills.
What Parents Need to Know
Children are not born with "money
sense." They learn by what they see, hear, and experience, and their
parents have a very strong influence on all of these. Childhood is the
appropriate time to learn about money management while the parent is able to
provide them learning experiences that will be of benefit in years to come.
Parents teach children how to manage money
by helping them understand what money means, how to make wise and satisfying
choices, how to use money to get things important to them, and how to have money
on hand for daily needs as well as for emergencies and future needs.
To help children of all ages learn about
money, parents need certain skills. These skills include:
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Guiding and supervising rather than directing or dictating.
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Praising rather than criticizing or rebuking.
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Allowing children to learn by mistakes as well as successes.
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Making spending plans and keeping family records.
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Conducting family money management councils - helping family members agree on and work toward short- and long- range financial goals.
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Being consistent.
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Being objective about the purpose of money - do not use it for rewards and punishment.
A Little About Your Child
The Preschooler
The preschooler learns from doing. Words,
actions, facial expressions, and tone of voice tell the preschooler how you
feel. This age child absorbs your feelings about money before he/she really
knows about spending money. Give the preschooler experiences with money. The 4-
or 5-year-old can begin using money to purchase small items.
The 6- to 12-Year Old
The 6- to 8 year old is usually eager
to learn but is restless and sometimes has difficulty making decisions. This age
child depends heavily on the approval of parents and can become too dependent if
parents don't encourage individual decision making. At age 8 the child's
concept of saving is beginning to develop, but he/she is still unrealistic about
things he/she can obtain. Interests change quickly at this age. By age 9 the
child can often make decisions and plans for carrying them out. From the ages of
9 to 12, the child is likely to become a conformist and follow the crowd. He/she
wants to be accepted by those of similar age. Children at this age need a chance
to let off steam, to express themselves, to talk, and to show their
independence. They also need understanding and guidance from their parents.
The Teenager
By the time youngsters reach high school
they often feel they can take care of themselves and make their own decisions.
This is an age where young people benefit from having been taught money
management from an early age. Such training has given the teenager the skills
and confidence needed to solve money problems.
Things to do
The Family
- Have regular family discussions about family money affairs. Involve all family members, based on their abilities to understand.
- Write down family goals, estimated cost, dates you hope to achieve them, and what each family member will do to help reach the goal.
- Use catalogs, newspapers, and shopping trips when determining the value of goods.
- Write down individual goals and when they will be reached.
- Do the value voting activity in this section.
- Check on your progress on a regular basis.
The Preschooler
- Provide money-exchanging experiences by playing store
with your child or several children in the neighborhood. Let the children
buy and sell items.
- Take the child on a shopping trip. Let the child have
a certain amount of money to spend, decide what to buy, and pay the cashier.
Later you might want the child to tell you about the purchase. Was the child
pleased, unhappy, satisfied, etc.?
- Help the child understand that family members work so
they can pay for family needs - the house, food, clothes, etc. Talk about
who works in the family and what they do. You might even take the child to
your place of employment. Let your child cut pictures from magazines to show
what the family spends money for. Help the child make a poster and hang it
in his/her room.
- Explain why the child can't buy everything he/she
may want. Talk about the difference between needs and wants. Let the child
pick out needs and wants from pictures on his/her poster.
- Occasionally encourage children to spend for something
they can share with others. It may be food, games, supplies, etc.
- When children can count to 10, introduce them to coins
- values and groupings. Help them understand what coins will buy.
- Avoid handing out money every time the child asks for
it or sees something he/she wants. If you hand out money in this manner, the
child will get the idea that all you need to do when you want money is to
ask for it.
The 6- to 12-Year Old
- Give the child opportunities to make shopping
decisions - help him/her learn to comparison shop.
- Involve this age child with family money management -
making out monthly checks, addressing envelopes, mailing packages, helping
with shopping, gathering information before a major family purchase.
- Provide opportunities for child to earn money. Keep
earning separate from allowance.
- Let child open a savings account. Be certain that the
child understands he/she is not giving the money away. Often children are
afraid to leave money at banks for fear they'll not get it back.
The Teenager
- Provide opportunities for teenager to manage personal
needs and wants and establish a spending plan.
- Give him/her greater responsibility in family money
management.
- Encourage the teenager to engage in work ventures -
either seek employment or become self-employed. However, note that 12 to 20
hours per week are enough to work. Longer work hours cut into study time
necessary for this age group.
- Help the teenager understand the use of cash and
credit when making purchases.
- Encourage long-range planning - education, job, and
future.
In the next lesson we will discuss where children get their money and look at the concept of allowances.
Value Voting
Let each family member vote on the situations below. Then let each person explain why he/she voted as he/she did. Discuss differences and why they exist.
If I had an extra $20 today, I would:
- Buy a book.
- Buy clothing.
- Save it.
If Mom and Dad had $2,000 extra, they should:
- Invest in the stock market.
- Buy a large screen television.
- Give it to charity.
NOTE: You
may want to make up additional situations related to your family and discuss
them. This is a good opportunity for family members to better understand the
concept of values.
Additional information from your
county
Extension office:
Family Account Record, MP-171
How Good Is Your Financial
Health?, FSHEC-14
This material was originally prepared by Joyce H. Jenkins,
Extension Family Resource Management Specialist, and Naomi H. Willis, Extension
Instructor of Home Economics, and is being used with permission of Clemson
University Cooperative Extension Service. Recommended to Arkansas by Wanda W.
Shelby, District Extension Family Resource Management Specialist, University of
Arkansas Cooperative Extension Service
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