Children are capable of learning how to manage money from a very early age. It is never too early to teach your child money management techniques. A teenager, taught how to manage money as a child, will be better able to cope with a changing financial world.

Purchase a Piggy Bank for your Preschooler
Once your young child is capable of putting coins into a piggy bank, she is ready to learn how to manage her money. Your child’s first piggy bank should be made of a durable material, such as plastic or tin. The piggy bank should be easy for young hands to open and use.

Your preschooler will enjoy helping you do household chores. Reward her for her good work by giving her a coin to put into her piggy bank. From an early age, your child will learn to work for a reward.

Encourage your child to take coins from her piggy bank and spend them. By removing coins from her piggy bank and spending them, your preschooler will soon learn the concept of saving and spending. She will learn the value of money if she is encouraged to regularly save and spend her own money. Do not allow your child to take all of the coins out of her piggy bank. It is important for a young child to understand she should not spend all of her money.

Buy your Child a Purse or a Wallet
It is difficult for young children to understand how a debit card or a credit card works. Although it is not practical to do your weekly shop using cash, take your young child on a special shopping trip and pay for an item with cash. Because young children collect coins in their piggy banks, pay for an inexpensive item, so you can use coins instead of notes. Once your school age child receives notes in her pocket money you can shop with notes as well as with coins.

Show your child how you take money out of your purse or wallet, so you can pay for what you want. Reinforce the idea of paying with cash by taking your child shopping once or twice a month and using this method of payment.

Buy a purse or a wallet for your child and let her keep a few coins in it. Allow her to make a purchase at the shopping centre, using money she has taken from her own purse or wallet. Children love to copy parent‘s actions, so she will soon learn how to manage her pocket money.

Teach your School Age Child How to Prepare a Budget
Help your school age child to prepare a written budget. Although young children do not have many expenses, you can encourage your child to save for family birthday presents or Christmas presents. A schoolchild will enjoy giving gifts she has purchased with her own money. Money for small treats, such as an ice-cream cone or a magazine, should be included in your child’s budget. Once your child has a written budget, you will be able to negotiate the amount of pocket money your child needs.

A teenager who is able to prepare a written budget will soon be capable of managing her own clothing account. Once she is accustomed to managing her own money, she will soon be budgeting successfully. If she purchases an expensive item of clothing, she will have to live with a very limited wardrobe until she receives her next payment from you. It will not be long before your teenager learns to spend her clothing budget wisely.

Your Teenager’s First Part-Time Job
Teenagers love to spend money. If your teenager wants to buy the newest magazines, books, music, and clothing, it is time to encourage your teenager to find a part-time job.

Fast-food establishments provide many teenagers with their first job. Delivering pamphlets or newspapers is another ideal first job for your teenager. If your teenager cannot find a regular part-time job, there are many occasional jobs she can do. Teenagers can mow lawns, weed gardens, walk pets, or shop for elderly or busy neighbours.

From her first piggy bank to her first part-time job, your child will learn the concepts of money management. Remember children learn by copying others. Be sure to set your child good examples. Before your child learns to manage her money successfully, she will need your guidance.