Don’t Forget Financial Fitness

Sometimes we can get so caught up in academics that we forget to teach our kids important life skills. Now, I’m not talking about basic life skills, like brushing your teeth or doing household chores. I’m talking about things like money management. Do your children know what it takes to create a budget? Do they really understand how much things cost? Are they prepared to manage their own money when the time comes? Are they on their way to becoming financially fit?

Regretfully, I must admit that I had never taught my kids how to be financially literate. Sure, they knew some basic information. We shop sales and use coupons and stock up when prices are low. We have talked about rising gas prices and tax increases. However, I had never sat them down and explained how all of the financial pieces come together, until now. God opened my eyes about this gap in their education, and I am trying to fill that gap with a money management class that I’m teaching for our homeschool co-op.

Even though kids might not fully understand concepts like compound interest or credit card debt, they do know the difference between having something and going without. You can teach kids of all ages about tithing, saving, and spending. For young children, you can set up a play store and allow them to act-out a shopping trip. Give them a list of items, either verbally or written, and some pretend money. Set prices for the store items and let your children shop. You can even announce special promotions so they begin to learn about sales and discounts.

For older kids, I suggest teaching them how to create a budget. This is a tool that will help them immensely in the future. Discuss spending categories and wants versus needs. Provide realistic data and challenge your kids to balance a sample budget. This is a great time to discuss student loans, starting salaries, and career choices. You can also teach them about housing and transportation costs such as mortgages and auto loans. Don’t forget to talk about credit cards and debt. If your kids are familiar with algebraic formulas, you can have them calculate compound interest. If not, there are numerous financial calculators online that can be used. Visual learners will benefit from seeing a graph of interest over time of a loan or investment.

Sometimes we fall back on the idea that our textbooks will cover everything that our kids need to know, but that’s simply not true. Sure, there may be word problems about banking in their math books, but do they really understand how those will apply to their lives? Will they be able to manage a bank account, balance a budget, and pay their bills? You don’t have to share your own personal finances with your children if that’s not something you’re comfortable doing, but teach them the skills that they’ll need to be successful when it comes time to manage their own finances. Someday, they will be thankful you did.

Heidi Kinney is a freelance writer and editor. Her background includes professional teaching in the area of mathematics, as well as writing and editing for several educational publishers. She has been homeschooling her children since 2007. She shares homeschool resources and lessons on her website, SharedLessons.org.