with GISS banks and purchased items!

Supercharge Your Kids Financial IQ with these Teachable Moments

1. When they want you to buy them something

Ask, “how could you earn the money to buy that?” You will find out very quickly how interested or committed they are to their desire for the item. If they are committed to saving for it, help them come up with a list of ways they can earn money - with ideas that are safe and appropriate for their age.

We went though this exercise in our house last year with cell phones. Natasha cut the grass, organized closets, had a yard sale and so on. She was thrilled and very proud the day she bought her first cell phone - just in time for the start of the school year!

2. At the grocery store

Have them help you compare prices. For years I've started this by saying “your mission is …” so they feel like detectives. My kids nearly fell over when they saw the difference in price between a can of frozen juice and premixed drink jugs. The premixed drink is almost three times more! Added bonus -they like stirring the frozen drink!

fyi - the grocery store is also a great place to discuss needs versus wants. For example, milk or fruit versus cookies. Key success tip for this lesson is: don't always go shopping when you're in a rush.

3. In the car

Discuss how much it costs to fill the tank, little kids like to see the numbers on the dial moving. You can discuss why airplane tickets cost a lot, because planes use a lot of gas and so on. Create stories whenever possible, that makes the lesson more memorable. As your children begin to learn the price of things, they will be able to begin to understand relative value through comparisons their brain will now have the information to make.

4. Going out for a meal

Let your child help figure out the tip, or if they are too young, count it out the cash on the table with them. These opportunities for real-life math and counting are disappearing in our digital world. This situation makes it more and more difficult for our kids to learn even the most basic money skills. This issue will only hurt their confidence around handling money and understanding cash flow as they get older, so give them opportunities now. Using cash is extremely helpful for children to understand real-life financial transactions; otherwise it is a very abstract concept.

5. When you are planning a big purchase

Encourage your kids to help you do the online research and find the best price and shipping charge. They love a reason to go online, and teaching them the value of doing research or "due diligence" before a big financial decision is an important life lesson which will positively impact their future well-being.

6. Choosing extracurricular activities

Whether you can afford to let your kids be involved in multiple activities or not, it is worth discussing the costs so they begin to understand relative cost and value, just like the grocery store example. How many hours of ice time do we get for $300? How much do you enjoy dancing versus soccer? It is important to involve our children in the decision making process as they mature. This will enable them to become more skilled at thinking through priorities and making thoughtful decisions in the future.

7. Allowance – their weekly practice in money management 

 Using the GISS Method - which stands for give, invest, save and spend,  teaches your child about the four main purposes they can use their money for. This way  they learn that money isn’t just for spending. For more information click here

8. When using your credit card

Show that you planned the purchase  - if you have your list or budget, show it. Explain the money you are using is borrowed until you pay the bill. Explain that they will have to pay their credit card bill monthly or they will have to pay large extra charges called interest. 

9. When discussing vacation plans

Discuss the choices and the costs. Many families have their pre-teens and teens research the travel plans and present the best options. Then everyone discusses and makes the decision together, it’s a really fun way for everyone to share the excitement.

10. Unexpected expenses

If your fridge or car breaks down, it is the perfect opportunity to discuss why having an emergency or “rainy day” savings fund is so important as they get older. When they have a car, they need to be prepared for unexpected expenses as well.

CONCLUSION:

It's never too young to start talking to your kids about choices, understanding value and demonstrating delayed gratification. These are lessons they take into their subconscious during the formative years and the experiences will form their beliefs and habits about money as their grow into adulthood. Don't underestimate the power of these daily life lessons. Consistency and repetition plus the opportunity to learn through experience is vital for your children to learn good financial habits.

What are your favorite teachable moments? Please share with our community. Parents all over the world want to help their kids learn these skills, just like you do.

I hope you found this information valuable. If you would like to learn more about the resources available to help you teach these life lessons, please visit us at http://www.zelawelakids.com