Kids in middle school have a more mature understanding of money. They know what it can buy and can plan farther into the future. If you haven’t already, initiate a weekly allowance. The reason: money coming out of a parent’s pocket appears infinite. Kids need an introduction to the real world, where money is limited and must be managed.
But teaching kids 10 to 14 about money isn’t all fun and games. Trying to have an extended conversation with your tween can be challenging, especially when the topic is considered bor-ing. Here are some hands on activities that you can do with your tween to get them involved and excited about managing their money.
Check out some online games. The Great Piggy Bank Adventure is an online financial-planning game where players begin in Fiscalville, work toward goals of saving and diversifying, and end up in Fat City. ING Direct’s Planet Orange site teaches kids about earning, spending, saving, and investing. Junior Achievement’s Money Might is a more sophisticated and challenging program that plunges into the key tenets of financial planning. Financial Football is a fast-paced, NFL-themed video game developed by Visa. Kids can test their money management skills by answering financial questions that allow them to move down the field and score touchdowns. (AO Wealth Advisory is not affiliated with any of the online games mentioned above.)
Employ your tween by finding odd jobs around the home beyond the scope of normal chores. Set a fair rate of pay and realistic expectations for the work. If you want to educate your kids about pay scales in the working world, pay more for grueling jobs like weeding and less for cushy tasks they can do in front of the television.
Set up a savings account online or at a local bank. Take some time to visit a local bank and explain how the banking system works. Even at this age, banks can be a mystery to tweens, who are often horrified to see their money disappear. Keep a budget of personal spending to see where your child's money is going.
Have your tween help you with the family budget. Explain that your income is divvied among living expenses, investments, your retirement plan, their college fund, and other obligations. Don't emphasize how much you have, but rather that you must manage your money wisely to meet financial goals.
Let your tween help with paying bills. Though they can't sign the checks, they can write in the amounts and prepare the envelopes. Be sure to show your credit card bill, explaining how much extra you'll owe if you don't pay it off each month.
Have your tween be involved in your next family vacation. As a family, decide ahead of time what you can spend on meals, destinations and special treats or souvenirs. On the trip, when you stop for gas, ask your tween to compare the gas prices for you to see which station offers the best price.
Have your tween do some research. If your tween really wants the latest phone, game box, stereo or computer ask them to find the best deal. Have your child compare total costs, taking into consideration base costs, taxes, shipping (if any) and the value of any add-ons (extended warranty, for example).
Do you have young children? Read my latest blog on the Patch entitled “Teaching Young Children About Money.”
Adam Obrecht, CFP® is the owner and founder of AO Wealth Advisory in Waukee, Iowa. His life passion is helping individuals, families and businesses maximize what they earn, invest wisely, and give generously to their family, charities, and community. Adam is on Facebook and Linked-In. Adam lives in Urbandale with his wife and two boys.
Securities offered through Broker Dealer Financial Services Corp., Member FINRA & SIPC. Advisory services offered through Investment Advisors Corp., an SEC registered investment adviser.