Six Tips for Teaching Kids to Share, Save and Spend

With the economy what it is today, there is no better time for parents to teach their kids lifelong lessons about responsibly sharing, saving, and spending. These lessons can go far in shaping kids’ attitudes and habits about money and its use.



Here are some ways to introduce kids to the concept of saving money:

1. Discuss and demonstrate with your child how you share, save and spend money: For example: explain how you share money by supporting your place of worship or a charitable cause; how you save money by depositing it in the bank; and how you spend  money on groceries and the home.


2. Work together on establishing a guideline on how they'll manage  their money: For example: if you set "share 10 percent, save 10 percent and spend 80 percent" as a guideline, the next time  your child gets $20 as a birthday gift, the child should divide the  money to meet the guideline.


3. When older children want to buy something immediately, ask them to  'Stop, think and choose': Stop to consider whether they really want or need the item, think how the money spent could be used more resourcefully and choose whether the item is really more important than other wants and needs.


4. Make it visual: For example: label three clear jars to serve as share, save and spend piggy banks allowing the child to see their  contributions add up. Each child at "Teach Your Kids to Share Day" will receive a 3-slot blue piggy bank to encourage sharing, saving and spending.


5. Make it fun: For example: initiate activities such as making ice cream sundaes at home rather than spending money on them at a  fast food restaurant. Set up a lemonade stand and agree to donate the proceeds to a local charity.


6. Most importantly, make sharing, saving and spending an ongoing conversation: Talking with your child is one of the best ways to build a financial foundation for the whole family.

Kids, Credit and Credit Ratings

You probably have never given much thought to your young child's credit history and rating. However, the increase in identity theft means dads have to be more vigilant about protecting their kids from thieves who will take their financial identity, often not to be discovered for many years. As crises go, this one isn't earth shattering, but the Federal Trade Commission, the federal agency that tracks identity complaints, says that 11,600 complaints for victims under 18 were filed in 2005. This is roughly double the number filed in 2003. Many of these are fraud cases involving relatives, but some involve real theft too.

What can dads do to protect their kids?

1. Guard their social security number. Social security numbers should only be given out for financial and tax purposes, and medical reasons; so ask yourself whenever anyone (school, community groups) demands your child's social security number. That goes for parents as well. At some point, the social security number could become a national ID number, but this has not yet occurred.

2. Understand how someone could use his or her number, so you understand why a child with no credit could be a target. Anyone working needs a social security number.

3. Watch the mail. Is your son or daughter suddenly getting mail solicitations for credit cards and loan products? This may be a warning sign that someone has used his or her number and your child has been identified as financially mature.

4. It's not a bad idea to consider checking your child's credit report, which you can do for free each year. You can also place a fraud alert on their records, but that has to be renewed every 90 days. Companies exist, like LifeLock (www.lifelock.com) that will track your credit and can add your children to their alerts. These are checks you can do for free by asking for a credit report, but may be worth the fees ($10 per month plus add-on of $25/year per child) if you are concerned.