How to Teach Your Children to Budget


Kids want STUFF

I have three children and two step-children. When the subject of their wanting things came up, it was usually answered by either putting off the conversation, telling them we couldn't afford it or letting them get something. They don't like it when you can't afford something. The first four drove me nuts. Evidently that wasn't a good solution.

With the youngest three, I got an idea to change that. We went to the flea market whenever we could. We loved to wander and look for little pieces to add to our collections, or for something we needed. The kids always asked for everything they saw, as is normal for kids. I started to give them a flea market allowance. They could get what they wanted with it but were not allowed to ask for more. It would only be $3-4 but it was usually enough to get something there. I thought it was funny that my little girl, who was seven at the time, would come home with her money more often than not. When I asked her about it, she answered that she didn't see anything that she wanted more than the money. She would have bugged me for ten times that much if I had been paying for it though.

Regular Allowance with Requirements

Shortly after the flea market experience, my baby started to get her sense of style. She started to bug me to buy her clothes constantly and her wardrobe wasn't big enough for her. We were, like most people, on a strict budget. My husband is on a VA disability and I was working; but life is expensive. Dennis only got paid once a month and that was just about enough to pay the bills. This left my check to buy food, clothes and pay for gas. I also needed to pay for any repairs on the vehicles, tires, and other emergencies. The boys were grown and out of the house but we still needed to budget. Katy was also wanting me to buy the expensive shampoos, conditioners, and lots of other grooming supplies that we could not afford. I was pulling my hair out with the frustration of my budding fashionista's expensive tastes.

Dennis was now old enough that he was getting his Social Security check and he suggested that she should start getting an allowance. Because her father was on Social Security, she got a small check for her needs. Her 'needs' were more than her income was though. How much do we give her? I got the idea to give her an allowance to buy these things with. She would be required to spend $5 on grooming necessities, $10 on clothes, and $5 for her to spend on whatever else every week.. This might work if she didn't cheat. That would give her $80-100 a month to buy clothes, $20-25 to spend on grooming, and $20-25 to spend on things that were not covered by those categories. Every payday, I gave her the allowance and the following day we went shopping for her requirements. If she wanted a pair of $30 jeans, she would have to save for a couple of weeks. If she wanted to go to the movies, she would have to save for it also.

She started out buying shampoo that was $7 a bottle. I would not spend that much, keeping her to the $2 shampoo that I used. She splurged and when she needed some conditioner that she had not budgeted for, I would let her use mine until she got her allowance again. Pretty soon, she had it figured out that she needed to make sure she had enough of everything. She now buys $1 VO5 shampoo and says it is the best shampoo that she has found.

Clothing is still a little hard on her. I admit that $80 is not really much when your shoes get worn out as fast as hers do. She loves to walk and will wear a hole in the bottom of most shoes in just 3-5 months. Finding a pair of jeans that are decent, look good and last well is also a problem. She has learned to shop the discount stores and yard sales. She has learned about checking the types and quality of the stitching. She has learned about quality over quantity and will save for something a little special. She wouldn't listen to me tell her that the lace shirt was pretty but wouldn't last very well. Now she will listen to me when I tell her about things like that.

I do pitch in once in a while and get her an extra pair of jeans, or buy her the warm winter coat. I will get her shoes and socks because I do not want her to ruin her feet for life because she is wearing an inadequate pair. This has been a very beneficial experiment for her though as it has taught her about using your money more usefully and planning ahead. She will buy an extra bottle of shampoo or an extra deodorant, in case she runs out between allowances.

I think the best comment out of this has been when she told me I was pretty sneaky when I started this. She thought she was getting such a great deal, but then she discovered the cloud in the silver lining. She didn't realize how expensive it was to pay for these things. This comment told me that this experiment was totally successful. She doesn't complain anymore when I tell her that we cannot afford something. She now knows what that means. It only took her four years to learn this and it came when she was not having to feed herself. I truly feel like she will be prepared to make sure that the bills are paid and that she will have food before she goes out and blows her paycheck on a Gameboy.

Do you think this method worked?

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Comments 45 comments

PegCole17 profile image

PegCole17 3 years ago from Dallas, Texas

Hello Becky. What a smart Mom you are to teach your daughter the value of discipline. I would vote on the third category, "Yes, my parents raised me this way too." You are not cruel. You're teaching her the importance of making good decisions and this is essential for her future and her financial success. Great hub.

Becky Katz profile image

Becky Katz 3 years ago from Hereford, AZ Author

Peg, my mom did not teach me this way. I had problems for years trying to figure this out. My sister is a miser though. Thank you for coming by to visit.

mckbirdbks profile image

mckbirdbks 3 years ago from Emerald Wells, Just off the crossroads,Texas

Hello Becky, I agree whole heartedly with your plan to teach the value of money and the wisdom of budgeting. It is a skill in short supply, but your daughter is now aware. This will pay her back over and over again as she now gets to skip over many surprises that come along without budgeting skills. Bravo

Becky Katz profile image

Becky Katz 3 years ago from Hereford, AZ Author

Thank you Mike. I was hoping to help her learn a few things by teaching her this way. It seems to have worked so far. Thank you for coming by to visit.

WillStarr profile image

WillStarr 3 years ago from Phoenix, Arizona

Great Hub, Becky. When I was about thirteen, I got a job repairing radios, and learned the value of money. It was a great lesson.

Becky Katz profile image

Becky Katz 3 years ago from Hereford, AZ Author

Will, thank you so much. It is hard to learn the value of money and some never do. I appreciate you coming by to visit.

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Vickiw 3 years ago

Hi Becky, great interesting Hub, and what you did was a proven method to help children budget - let them be in charge of their own allowance! My daughter is an amazing budgeter now, and has taught her two children the same way. Your children and grandchildren will benefit from what you have done. Great information, and I hope lots of parents will help their children in this way.

Becky Katz profile image

Becky Katz 3 years ago from Hereford, AZ Author

Vickiw, it is hard to know how to proceed at times when we are trying to teach our children. Something that may work on one child won't work on another. I guess this may help someone that has tried other methods that didn't work. Thank you for coming to visit.

Rosemay50 profile image

Rosemay50 3 years ago from Hawkes Bay - NewZealand

A great way to teach her for the future Becky, she will benefit all her life now for the lessons she learned from you. I too as soon as mine were teenagers gave them a monthly clothing allowences. It worked with my daughter but not quite so well with my son. I am sure many will take your advice Becky

Becky Katz profile image

Becky Katz 3 years ago from Hereford, AZ Author

Rosemay, I wondered at the time if I was insane but now I think it was the best thing I have done. I truly think this is the only way she would have learned this. I do add to it occasionally when we had a little extra and she was a little short on clothes but I know she works hard at making the money stretch as far as she can. Before she just wanted to see how much she could get. I could not afford it. Now we get along better. She knows I am not going to bail her out if she screws up and she plans for things. I appreciate you coming by to visit.

drbj profile image

drbj 3 years ago from south Florida

You not only did the right thing teaching your children to budget their allowance, Becky, you also did the smart thing. Those lessons should last throughout their lives. Parents who give their children everything they ask for set the stage for potential ongoing monetary problems in their kids' lives as they become adults.

MartieCoetser profile image

MartieCoetser 3 years ago from South Africa

Excellent method, Becky! It is so important to teach children at a young age how to stick to a budget. Excellent!

Becky Katz profile image

Becky Katz 3 years ago from Hereford, AZ Author

Martie, It is so crucial for their future financial health to learn about budgeting and sticking to it. She moves a little around once in a while but stays pretty close to chat I told her. Sometimes, she will buy more of her necessities but she will catch up on the clothes later. We also need to remember that we cannot borrow from others every time we mess up. I appreciate you coming by to visit.

Becky Katz profile image

Becky Katz 3 years ago from Hereford, AZ Author

drbj, My husband and I had an argument when his oldest son turned 16 and got his license. He wanted to buy him a car and I said no, let him earn his own, he will take better care of it and appreciate it more. I won finally, mostly because we did not have the extra money to buy a car for a teenager. When he finally bought his own car, he took better care of it than his friends took care of their cars that their parents bought. My husband didn't bring the subject up again. I appreciate you coming by to visit.

marcoujor profile image

marcoujor 3 years ago from Jeffersonville PA


You are wise and remind me so much of my dear Momma...I am very comfortable with giving kids a budget. Lessons learned early tend to last a lifetime.

Well written. Voted UP and UABI. Hugs, Maria

Becky Katz profile image

Becky Katz 3 years ago from Hereford, AZ Author

mar, I never feel wise. Sometimes it takes me forever to figure out what will work. I do try to use common sense though and it is common sense that you learn best when you learn early. I appreciate your comparing me to your dear mother. I am so honored by that. Thank you so much for coming by to visit.

stuff4kids profile image

stuff4kids 3 years ago

What a great mom you are. I totally agree with this approach and it's pretty much the same that I have done with my brood. I really think that it's not just about money but also learning about the value of everything and how we need to carefully manage all our limited resources. My youngest (they are all older now) delivers papers to earn his money and so he takes real satisfaction in it being his hard-earned wage not just 'pretend' because he did nothing for it.

It is such an important lesson to learn. These are simple skills and attitudes that we all need. Good parents teach them. Thank you so much for sharing this!

Voted up and everything. :)

Becky Katz profile image

Becky Katz 3 years ago from Hereford, AZ Author

stuff4kids, Learning the value of things and that money does not grow on trees is so valuable for us. I also make my daughter help with things in the house. She doesn't just get an allowance GIVEN to her, I make her earn it. Learning that some things just cost more and others are worth more is a valuable lesson too. I appreciate you coming by to visit.

teaches12345 profile image

teaches12345 3 years ago

Your child will benefit from this "real-life" budgeting lesson. Very wise, dear mommy!

Becky Katz profile image

Becky Katz 3 years ago from Hereford, AZ Author

teaches, some kids will learn about budgeting by your telling them about it. Mine won't, she has to see for herself. I have had to give her several rough lessons. She learns better that way. Thank you for coming by to visit.

khmazz profile image

khmazz 3 years ago from South Florida

Wonderful parents did pretty much the same thing with me and I am so thankful they did! Way to go and thanks for sharing :)

Becky Katz profile image

Becky Katz 3 years ago from Hereford, AZ Author

khmazz, Many parents did this and yet many did not, leaving their children with no idea how to teach their children. I appreciate you coming by to visit.

Lisawilliamsj profile image

Lisawilliamsj 3 years ago

This is such a good ideal and so well written! Thanks for sharing, I might have to use this!

Becky Katz profile image

Becky Katz 3 years ago from Hereford, AZ Author

Lisa, raising kids is an imaginative thing. Sometimes we need to get inventive as heck to get things through to our kids. And have friends that are imaginative. I appreciate you coming to visit.

Marlin 55 profile image

Marlin 55 3 years ago from USA

Hi Becky, this hub really caught my attention and I hope that a lot of parents read this. It's so important that children learn how to earn and budget money. I give this article a thumbs up.

Sunny River DIY profile image

Sunny River DIY 3 years ago from A Place Without A Name which resides somewhere between Fantasy and Belief, just north of Reality.

This was awesome! My parents did something like this when I hit high school and started driving. They gave me a certain amount of money a week to be used for gas and then whatever else I needed. They didn't give me anything this specific, but I was buying my own lunches and so I had to budget out if I had enough to go shopping or to the movies with my friends. It's a great way to teach. :)

Becky Katz profile image

Becky Katz 3 years ago from Hereford, AZ Author

Hi Sunny River. I am happy that you liked this. It is hard to learn to budget and since she was so young, I gave her some initial guidelines. She is 16 now and has pretty much gotten out of the guidelines. I still make her buy her clothes from her allowance and also her toiletries. She has a little more leeway now though. Her movies and outings, she will get a little from us for, but most things she has no extra help. Movies are so expensive here that she would spend an entire months allowance on a movie and have nothing for other outings. We did not feel that was quite fair, so we will buy the ticket for her. She still has to buy her own drink and snacks. She has gotten snacks at the grocery and taken them in her purse, saving quite a bit. She also takes a 20 oz. bottle of soda with her and that saves her a bunch. The employees don't seem to care. I appreciate you coming by to visit and the nice comment.

b. Malin profile image

b. Malin 3 years ago

I thought I'd made a comment on this Wonderful Hub Becky. It is Truly a timeless one. My children also got allowances and they also mowed lawns, shoveled walks and driveways...and so they learned to Budget their monies. Yes, there was a little "help" from us...And today, they are grown men who have taught these values to their own children...And the Beat goes on!

Becky Katz profile image

Becky Katz 3 years ago from Hereford, AZ Author

Hi b. It is nice to see you here today. I struggled at times trying to get my boys to get the idea. They know how to work, but neither of them are any good at budgeting their money. The idea for this came about because our daughter had Cadillac taste and we had a Ford budget. She wanted the expensive shampoos and more and more clothes. In exasperation, I gave her a budget and made her figure it out. She just did not get it at first. Now she gets it and is doing well. She still complains that she doesn't have enough clothes, but she gets by mostly. We will buy her some occasionally, when we can see she is trying to make it work and just not making it. I appreciate you coming by to visit and thank you for the nice comment.

manatita44 profile image

manatita44 2 years ago from london

Quite clever ways of affecting children, Becky. Motive is always its own reward.

Becky Katz profile image

Becky Katz 2 years ago from Hereford, AZ Author

manatita, Thank you, I truly appreciate you coming by to visit and leave such a nice comment.

DrBill-WmL-Smith profile image

DrBill-WmL-Smith 2 years ago from Hollister, MO

Wonderful model to follow, Becky. You are to be commended. Thank you for writing it up and sharing, as well. There will be many who follow your example, in one or more ways. ;-)

Becky Katz profile image

Becky Katz 2 years ago from Hereford, AZ Author

DrBill, I appreciate your support on this and you coming by to visit. Teaching our kids things is one of the hardest tasks we will ever have. Getting other ideas is always useful.

peachpurple profile image

peachpurple 2 years ago from Home Sweet Home

Good and helpful tips i need to teach my kids

Becky Katz profile image

Becky Katz 2 years ago from Hereford, AZ Author

Each parent gets different ideas to raise their children. Passing them on helps others raise theirs. I used many ideas while raising mine. Blessings and luck raising yours. Thank you for visiting.

sgbrown profile image

sgbrown 23 months ago from Southern Oklahoma

Teaching your children to budget at a young age is very helpful to them later. Our children got allowances and then were able to make a little more money by doing extra chores around the house. They learned early to budget to get things they wanted.

Becky Katz profile image

Becky Katz 23 months ago from Hereford, AZ Author

sgbrown, All of my children eventually learned to budget, but my daughter is the best at it. She learned that sometimes you have to buy less expensive things in order to get everything you need. She also learned to buy all of the necessities before she bought wants. My older two have slipped up on that one occasionally. I did not give them more money for extra chores, I usually allowed them to go to a movie or something like that for extra chores though. I appreciate you coming by to visit.

torrilynn profile image

torrilynn 21 months ago

I think its always a great idea to teach your children new techniques and budgeting is a great thing to teach your kids. thanks for this hub. very useful and informative. Best of wishes.

Becky Katz profile image

Becky Katz 21 months ago from Hereford, AZ Author

torrilynn, Thank you for the nice comment and coming by to visit. I appreciate it.

peachpurple profile image

peachpurple 20 months ago from Home Sweet Home

yeah, kids wants everything especially what their friends have in hand, they can't lose out

Becky Katz profile image

Becky Katz 20 months ago from Hereford, AZ Author

peachpurple, If we teach them properly, they learn to decide which is more important. They will then be ready to make the important decisions in life.. Thank you for coming to visit.

Perspycacious profile image

Perspycacious 8 months ago from Today's America and The World Beyond

I think I might have left out the deodorant reference lest her peers find out that her mother publishes on HubPages, but the rest commends itself to any parent serious about parenting.

Parents need to figure out that they can't buy their children's love without spoiling their children's lives. Say amen.

Becky Katz profile image

Becky Katz 8 months ago from Hereford, AZ Author

Perspycacious, Amen, but my daughter was also home schooled from 4th on. She does not get embarrassed by anything and she has a wonderful sense of humor. She is also going to college now, studying to be an early childhood teacher. She does not want other kids to have a teacher like one that she had in 3rd and 4th. That one was a bully worse than any kids could ever be.

As for her not wanting anyone to know I have published on here, she tells them to come read my writing and learn something. She likes my work.

Perspycacious profile image

Perspycacious 8 months ago from Today's America and The World Beyond

I was not implying that the daughter in question would not want her peers reading her mother's Hubs, only that she might have been embarassed that deodorant was needed as part of her regular shopping list.

BTW When appropriate, Isopropyl Rubbing Alcohol is a cheaper form of deodorant than most commercial ones and it is effective because it kills what causes body odor.

Becky Katz profile image

Becky Katz 8 months ago from Hereford, AZ Author

Perspycacious, she does not seem to get embarrassed by things like that. She will talk in front of guys about things even more personal. The new generation seems to have no problem with that. I would never have been able to speak of something like that around guys. I appreciate you coming by to visit.

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