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CCCS Offers Tips on Raising Money-Smart Kids
Did your parents teach you how to manage your money? Chances are they did not. As a result, you may have learned some financial lessons the hard way.
Don't shortchange your children's financial education. Teach them the importance of saving, thriftiness, honesty and generosity. These values will direct your children when it is time for them to make their own decisions.
Here are tips from the Consumer Credit Counseling Service (CCCS) on raising money smart children.
- Give children an allowance. Allowances promote responsibility and show children how to manage money. The allowance should be big enough so some is left over at the end of the week for the child to spend as he or she sees fit.
- Cure the "I want everything" condition. Is it any wonder that today's children have many wants as they are bombarded with commercials for clothes, music CDs and toys? To combat this advertising blitz, parents should teach the difference between needs and wants early on. Needs are basic necessities such as food, clothing and shelter, and wants are wishes like toys, jewelry and designer clothes. Emphasize the importance of taking care of day-to-day household expenses before buying another set of Pokemon cards or a beanie baby.
- Be consistent. Every parent has done it. They've bought a toy or candy just to quiet their child. However, once you start this, the precedent is hard to break. Instead, you should explain to the child that he or she can use his or her own money or save up for the desired item. You will be surprised how quickly interest can wane when children have to use their own money.
- Start a child savings account. Take those $5 bills from your child's birthday cards and open a savings account. Let the kids know that they will be able to use the money for that high school trip to Europe or that first car. Putting away money teaches restraint, how to prioritize purchases and how to plan. You can put your child's money in a bank account, certificate of deposit, savings bonds, money market account, mutual funds or other investment vehicles.
- Teach children the importance of giving. Strive toward rearing a child who is both responsible and charitable. Encourage your child to make an occasional contribution to the needy, write thank you notes to gift givers and participate in fun runs, telethons and other fundraisers.
- Raise a savvy shopper. Has your child ever bought a cheap toy that disintegrated on the first try? If so, he or she learned an age-old adage: "Buy cheap and you buy twice." Allow them to make small spending mistakes now to avoid mistakes later.
- Practice what you preach. All the good advice in the world is for naught if your child sees you doing otherwise. Show a healthy respect for money, make sure you compare prices when you shop and stress the importance of saving for unanticipated expenses.
If you are an educator and would like to takeadvantage of the many money management programsfor children offered by CCCS in the Greater Houston Area, call Deborah Goff at 713-923-2227.
-From the Consumer Credit Counseling Service
©2006 Texas Medical Center
E-Mail: tmc-info@tmc.edu
URL: http://www.tmc.edu/tmcnews/01_15_00/page_10.html
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