What Kids Should Know About Money

By Dr. Bernice Wilson

No one can argue that children should be taught the value of money. In fact, they should be exposed to educational activities that will encourage them to learn about money at an early age. Experts will also agree that children should be taught how to save money and that saving money should be emphasized as children learn more about money concepts.

Parents can start by identifying an affordable allowance for a child. Instill into the child why this allowance should be spent using a budget, and help the child understand why it is important to stay within a given budget.

Perhaps a parent may wonder at what age should a child be introduced to money concepts. You may find these age guidelines helpful as you teach children about money.

American teens spent an average of $104 per week in 2001 according to a Teen Research Unlimited study. Approximately $172 billion passes through the hands of youth annually, or an average of $3,000 each year. You might wonder where they spend their money. Following is a list of merchandise or goods that teens often purchase:

Decide with your child in advance how much of their money (earned or allowance) should be saved. If your children have a summer job, they could make more money than they should spend. Also, set an achievable goal to be reached with the savings, i.e. trip, clothing, books.


References

National Consumers League (2002). Teens and finances. Money and Credit. Retrieved June 9, 2003.

Womack, Sandra. (2001). Family money matters. Maryland Cooperative Extension University of Maryland College Park, Eastern Shore.

Bodnar, Janet and Matt Popowsky. (August 2000). Into the job pool. Kiplinger's Personal Finance Magazine. Vol. 54, Issue 8, p. 126-128.

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Page was last updated:
July 15 2003

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