How to Teach Your Children to Budget

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.

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.