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Of Slugs and Budgets – Teaching Money Management to Kids

Of Slugs and Budgets – Teaching Money Management to Kids

When my oldest son, Nathan, was four years old, I caught him crying silently in bed one night. I had gone back into his room to tuck him in as he liked to spend a few minutes “reading” to himself before saying goodnight. Seeing him crying concerned me.

“Nathan, what’s the matter?” I asked.

He lifted the book he had been reading and turned to the page where a cartoon representation of a slug was sitting behind a ticket booth. The sign read: Hugs and Kisses $1.00 50¢ 25¢ 05¢. The book he was sharing with me was called The Unhuggables: the truth about snakes, skunks, spiders, and other animals that are hard to love.

“He looks so sad,” Nathan sniffed, pointing to the slug, who did, indeed, look pretty sad. “No-one wants to give him a hug.”

Not being a huge fan of slugs, myself, but relieved that this was what made him upset, I had to quickly figure out what purpose slugs served.

“Oh, honey,” I stalled, “Slugs are misunderstood. They’re actually quite useful. They decompose a lot of dead leaves and that’s a very good thing because it puts nutrients back into the soil which helps flowers grow. But not many people know this otherwise I’m sure they would be giving him hugs and kisses.”

I actually impressed myself that this little bit of information about slugs surfaced in my brain. I guess I really was listening in biology class. And the good news is that hearing this seemed to satisfy Nathan.

“We should tell people that slugs are good,” he said.

“Yes, we should,” I agreed. Five minutes later, he was asleep.

Budgets are like slugs. They’re often misunderstood. And because of that, people find them unhuggable.

But budgets actually serve a very important function. Budgets help us get the things we want in life: a new car, a house, college education for our kids, more time with our family, the ability to travel to exotic places… Money is the tool that can help us achieve those desires. A budget helps us use that tool effectively.

So teaching our kids how to budget is important if we want them to achieve their goals in life. Kids budgeting? Of course! The good news is, teaching them is pretty simple. Here are three ways to give your kids hands-on experiences with budgeting (excerpted from the book Raised for Richness):

The Birthday Party – ages 7+

Decide how much you are willing to spend on your child’s birthday party. Get CASH in that amount (that’s your budget) and put it in an envelope labeled ‘(Sara’s) Birthday Party’. You’ll use the envelope to help you keep track of your running expenses.

Then have your child help you make a list of all the expenses related to the party. Making a list will help you stay focused when you’re shopping. And thinking of these in advance will teach your child to be organized. She’ll need to consider number of guests, party games, food, party favors, paper plates, etc.

Now the fun part…you get to go shopping. As you buy items, write the total on the envelope and keep a running balance. Using cash will underscore the value of a dollar (it makes a difference if you can SEE the money) and help you stick to the budget.

Tweens and teens can go a step further and come up with the “flow” of the party…when to play games, when to eat, etc.

Clothing Allowance: Tweens and Teenagers

This is a great back-to-school-shopping activity, but can still be used any time of the year. Tweens and teens are quite capable of shopping for themselves. They may make mistakes along the way, but those are great learning opportunities. So giving them a lump sum of money and putting them in charge of spending within the limits of a budget is good practice.

Just like the birthday party activity, begin by deciding how much you’re willing to spend on clothing. Consider how long you expect those clothes to last. In other words, are they shopping for all their fall/winter clothes? Then have your child make a list of needed items: 2 pair of jeans, three t-shirts, socks, warm jacket, etc.

Again, get CASH in the needed amount. Tell him that he needs to buy all the items on the list and any money left over is his to keep! This usually gets kids to think carefully about their purchases and look for good deals. Instant savvy shoppers!

The Cell Phone: Teenagers

Parents have been handed an unbelievable tool to help teach teens how to budget. It’s the cell phone. Yup, that object of love and hate. Done correctly, it becomes an object of learning. Here’s how.

Teens need to stay connected to their friends. This is normal as they figure out their place in the world. Cell phones keep them connected. Using their “need” for a cell phone as the motivator, we can teach them basic money management skills such as budgeting and paying bills.

First, teens need to know that along with a cell phone comes responsibility. Keeping track of your cell phone, resisting the urge to text during dinner, and paying your phone bill. Kids paying bills? You bet! And the best time to teach them is while they are still hanging out with you.

Next, it’s important to establish what part of the phone bill your child will be responsible for. For example, you may pay the family plan fee but maybe your teen pays the additional phone line fee, texting, and upgrades…

Now comes the fun part. Kids learn to budget their money in the context of something the love…their cell phone! Upgrades? They pay. Overages? They pay. Lost phone? They pay. Unpaid bill? No phone. See how simple it is? Okay, so it’s going to take a few months before everyone understands how the whole thing works, but when that happens, it’s a thing of beauty. Kids are happy; as long as they budget their money correctly, they stay connected to their friends. Parents are happy, their kids are learning real life skills. It’s a win/win.

Although a lot of parents are willing to pay for their kids’ cell phones because it offers peace of mind, how about the peace of mind that comes with knowing your child is ready to take on the financial challenges that await her out there? Don’t miss this silver platter opportunity. With teens, when you get the chance, take it!

Adopt a Class or School – Change a Life Campaign

Adopt a Class or School – Change a Life Campaign

We’re working with Sammy Rabbit on his “Adopt a Class or School – Change a Life” campaign. If you’d like to participate, email me. Details are below.

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For more information about the books and CDs visit:

Order or Questions? Email me at:

Money Jars

Money Jars

Learning to save money is an important life skill. During America Saves Week (February) or Financial Literacy Month (April), I like to have small groups of students rotate through the Money Jar Center. I’ve also done it as a whole class activity with second grade and up.

Students do have the option of using a hot glue gun. I go over the rules very carefully. Even so, there are usually a handful who choose not to use the glue gun. And that’s perfectly okay because there are a variety of other objects for them to use like colored sharpies, foam stickers, and regular stickers.

For directions on making the Money Jars:

Materials needed:
-mason jar
-hot glue gun and glue sticks
-fabric scraps
-pom poms
-permanent markers
-any other fun stuff to place on jar

Using a mason jar for this activity is important because it allows your child to watch her money “grow”. In addition, the lids are perfect for customizing a slot where the coins/bills will go through.

1.Remove the metal circular lid and cut a cardboard circle the same size. Throw away the circular metal lid.
2.Cut a slot in the cardboard large enough for a quarter to easily fit through.
3.Use a large enough piece of square fabric to cover the cardboard and have plenty left over to spill over the top of the jar.
4.Cut a slot in the fabric to match the slot in the cardboard.
5.Have your child/students decorate their jar. You can squeeze the glue from the glue gun onto the jar for her. Or, if you prefer, there are plenty of non glue-gun materials you can use to decorate.
6.Glue the ribbon around the rim of the lid.
7.Screw the lid on tight and begin dropping in coins!

5 Easy Steps to Teaching Kids Money the Brain Compatible Way

5 Easy Steps to Teaching Kids Money the Brain Compatible Way

Turns out, we can actually teach in a way that’s compatible with our brain.   And when we do, interest level increases, retention improves, and confidence builds all leading to more complex learning.  That’s the conclusion of decades of research about how our brain works.

The good news is, brain-compatible teaching is not that difficult to do.  It all begins with designing an effective learning environment.  Here are 5 easy steps you can take to create an environment conducive to optimal learning:

1.  Make Connections.  In ed speak, we call this using prior knowledge and it simply means that we relate new information to old, familiar information.  The content becomes more meaningful this way and allows for deeper learning to take place.

The Money Connection:  Tie in an earlier money event with a real-time similar situation. Prior experience:   “Remember when you accidentally lost the birthday money Grannie gave you?” New knowledge:  “If you put this Christmas money into an account at the credit union, your money will be a lot safer.”

If you don’t have any prior experiences to use, books are a great way to jump-start these conversations.  For example, in the book Alexander Who Used to be Rich Last Sunday, you can help your child make the connection between Alexander spending all his money and not being able to buy the walkie-talkies he wants and the fact that, “Just like Alexander, if you keep spending your money on those little items, you won’t have enough to buy that game you really want.  What are some things you and Alexander could do to make it easier for you to save money?”

2.  Tap into their Interests.  We learn best when we’re engaged in interesting and meaningful activities that are connected to our every day lives.  That’s because the activities are real-world and personally relevant.  And when it’s all about us, we’re much more engaged and motivated to learn.

The Money Connection:  Set up an allowance with your child and have her be responsible for all her discretionary spending.  Make sure the expectations and responsibilities are clear. Now step back and allow her to make the decisions about what happens to that money.  It’s about real experiences with real money.  She’ll learn about saving, spending wisely, borrowing, sharing, earning, and investing.

3.  Ask Questions. Ask lots and lots of questions.  The human brain was designed to think and problem solve.  So let it do its thing.  Not only does asking questions encourage critical thinking skills, but by asking your child to share her thoughts with you, you’re showing her that you value her thinking and believe in her ability to solve problems.

The Money Connection:  Why did you choose to spend your money on that?  How could you get the money you need to buy that?  What are some ways to keep our money safe?  What would you like to be when you grow up?  What effect does advertising have on our needs and wants?  Is that item worth the money you spent on it?  Is ‘friendship’ a need?  Why do you think budgets are important?  It’s endless really.

4.  Provide a Safe Climate for Learning.  We don’t learn when we’re anxious, upset, or feel threatened. These negative emotions actually block information flow to the brain.  For real learning to take place, we need an environment free from the fear of embarrassment, judgement, or failure… a place where we feel loved and accepted.

The Money Connection:  Money is a new experience for kids.  Because of that, they’re curious and are going to ask questions.  As openly, honestly, and developmentally appropriately as you can, answer their questions.  Aren’t sure?  Learn new things together.  Respect their desire to make their own money choices.  When they make mistakes, be there without judgement to guide them.  All of these build trust.  And trust builds confidence…something our kids will need to manage money effectively as adults.

5.  Live a healthy lifestyle.  Drink water.  Get regular exercise.  Sleep.  Eat your veggies.  This may seem like a no-brainer (!), but sometimes we forget how important these are to healthy brain development.  Teach these to your kids.

The Money Connection:  Studies have actually shown that those who are physically healthy tend to be healthier in their finances, as well.  Now, simply eating broccoli isn’t going to make us great money managers, but making sure eating healthy is a part of your regular regime ties into self-discipline.  And self-discipline is a key ingredient when it comes to effectively managing money.

If you think about it, it’s pretty amazing that we can actually influence our environment in a way that allows for deeper learning to take place.  And now that we are equipped with this information, (thanks brain!), just think of the power we have to make a difference in how our children grow and develop.

Great Holiday Gifts: Board Games that Teach Money Concepts to Kids

Great Holiday Gifts: Board Games that Teach Money Concepts to Kids

Board games are always great gifts for the holidays.  And board games that teach kids money skills are doubly great!  The key is to sneak in the “money conversation” as you play.

For example, the popular Game of Life oozes opportunities to discuss buying a house, paying insurance, being prepared for unexpected expenses, playing the stock market…

And the lesser known Allowance Game is perfect for discussing wise spending choices, earning interest on savings, and jobs that your kids can do to earn extra money.   Gently tie in your real life experiences with these important money topics as they come up during the game.

We sometimes assume that, through osmosis, kids will make the connections between the money lessons in the game and what happens in the real world.  That is not always true, so it’s up to us to be on the lookout for these priceless opportunities!

Here is a list of additional fun games that help teach kids about money:

Presto Change-o (ages 4 and up)  Making change

Monopoly Junior (ages 5 to 8)  Adding/subtracting money

Pit (ages 7 and up)  Investing, understanding the stock market

Cashflow for Kids (ages 7 and up)  Investing, general financial education

Payday (ages 8 and up)  Household finances, bill paying

Monopoly (ages 8 and up)  Adding/subtracting money, real estate