10 Tricks to Help Kids Discover Their Spending Style

The other day my mother gave me my great grandfather’s compass. It made me think about how we all need guides to show us how to manage life, whether a compass to find the way in the wilderness or a guide to help kids steer toward adulthood by teaching them about money.

What do you use as a guide when making spending decisions? It is essential to have something to help you judge your spending habits because spending can be similar to addiction. We overspend for many of the same reasons we drink too much or misuse drugs. When we experience discomfort, peer pressure, or just need a distraction. It will be hard to show our children how to spend if we haven’t figured out our relationship with money.

What stops you from purchasing a latte every weekday morning? If you pencil it out, it equals around eighty-eight dollars. Do you value lattes enough to sacrifice something you love more, like a gym membership or paying off debt on a high-interest credit card?

We don’t always think about our actions’ impact on our children. Sometimes we don’t understand what kids see from their level. The things we do speak louder than the words we say. For example, when we mindlessly purchase things, we don’t need. The keyword here is “mindlessly”. If you take a moment to pause and consider what goal or why you are purchasing a specific item, it is helpful. It is too easy to buy on credit, giving us the illusion that we never need to wait for anything.

Once you’ve identified what you value, it is easier to make decisions in a flash. Your brain sees the end goal. Here are some hints to help your kids learn about spending.

1. Teach your kids to imagine their future selves. Imagining your future self is a great way to predict the consequences of your actions. “If I buy this now, it will feel good, but what does it mean in two months from now?”

2.  Show your children how to deal with problems as they occur. Facing your demons means opening the mail each day and facing the reality of what we owe –not opening your mail can cause a reservoir of suffering later.

3.  Play the budget dinner game. When you do this exercise, you must allow your kids the freedom to fail, or it will not teach them what you intended. Allow your child to pick out what your family is having for dinner. Give them a budget and shop for the needed items.

4. Play the price per pound game. Price per pound is a great way to measure costs equally.

5. Teach your kids about marketing. We are constantly being marketed by sneaky social media influencers and telemarketers, primarily online. Media of all types are trying to sell to us.

6. Teach your kids to get comfortable with discomfort. Sometimes, when I’m uncomfortable, I’ve found that I want to spend money—noticing this discomfort and allowing it to pass without buying twelve new pairs of shoes is a valuable skill.

I worked for a very wealthy man once who told me a secret. He said, “Do you know why banks are made out of marble?” then he whispered this,” Compound interest.”

7. Borrowing money is more expensive than saving money for something. When you borrow money, you have to give a lot away in the form of interest.

 8. Ask your kids how it feels to spend money on something that disappoints them. Having your kids check-in with their feelings is a compass moment. It will help them recognize what they value, which will guide them for the rest of their lives. 

 9. Take a moment. It is always a good idea to walk away and think about your purchase.

10. Achieving a money goal builds self-efficacy and self-esteem. Budgeting teaches us about what matters to us.

Learning about money sometimes feels a bit like being lost at sea. It is our task to help our children find their bearings. Help them use the tools they have, like their own emotions, to identify what works for them and what doesn’t. We can give them tools to test the waters and see how they feel when making mistakes. They have to use their emotions as a compass to guide them to shore. You can teach them this skill by allowing them to make mistakes and learn from those blunders. It is hard to let go, but it is an important parenting skill. Bon Voyage!

Here’s another fun way to learn about money. Click here to play the Cartoons: Needs vs Wants game as a family.