How Children Use Money

Children, like adults, usually have many opportunities for spending money. The trick, of course, is to spend money wisely on the goods and services that will help them reach their goals. Children need experiences that will teach them consumer skills, such as how to shop, what features to look for, how to get information on a product, how to complain and how to make decisions about whatto buy and when to buy it.

Some guides for helping children spend their money are given below. You may think of others that are appropriate for your family and the other children with whom you interact.

• Help children set limits on how much they should spend. Do this by asking children to name or list their “needs” as they see them and help them sort these “needs” into most important and least important.

• Teach children buying skills by comparing prices and quality and discussing the advantages and disadvantages of buying items on sale. Remember that you are a role model, so use good shopping habits for family, household and children's personal expenditures.

• Help children accept responsibility for their decisions when spending money. They may need your advice and encouragement to weigh the alternatives to make the best decision.

• Shop by phone, catalogs and fliers before going out to buy. This can help you save time and energy.

• Hang a family “wanted” list of items, prices and dates on your refrigerator. If you still want the items in three months, negotiate how to save for them.