Seven summer money lessons for kids

Summer provides plenty of opportunities for teachable moments as families spend more time together in a relaxed atmosphere. Here are a few valuable financial lessons parents can pass on to their kids this season.

Experiences, not things, lead to happiness

Research shows that people get more happiness bang for their buck when they spend money on experiences — such as a trip, a meal with friends or a concert — as compared to things (eg., clothes or technology). Children often intuitively understand this, which is why they might look forward to a family vacation or summer camp even more than Christmas or their birthdays. To underline the point, ask your kids to make a list of what it is about summer that makes them happy. Chances are that most, if not all, the things they put on their list — swimming, eating ice cream, hanging out with friends, blowing bubbles, going to the amusement park, outdoor parties, riding a bike — will be experiences, not things. You can remind them of this next time they plead for a big-ticket item.

Lots of memorable experiences are inexpensive or free!

See above.

Summer camp, vacations, etc., all cost money

Teens will, obviously, already know this — but younger children may not. It’s important you explain parents work hard to pay for these things — not to make kids feel bad but so they won’t take them for granted.

The ice-cream truck is a bad deal

Yes, it’s exciting when the truck comes rolling through the neighbourhood with its music calling to all within a five kilometre radius. But those treats are overpriced and not all that tasty. Keep some premium grocery store ice cream in your freezer and explain that for the price of two ice-cream-truck cones, they can have a whole week’s worth of yummier indulgences at home.

Loaning/trading stuff can be a clever way to save money

My son and his friends have really impressed me with the way they share video game cartridges. When they get together, they’ll arrange to switch games for a week or more — enough time to get bored with it — and then switch back. Kids can do the same with any kinds of toys or gear; the caveat, of course, is that the friend has to be someone your child trusts.

Selling a service means more money in your pocket

Lemonade stands are well and good, but after you’ve subtracted the cost of the supplies from the kitty, there won’t be much left over. Instead, suggest that kids who are old enough find odd jobs to earn extra money. On Facebook, I saw someone offering her tween’s weeding services — he charges 10 cents per weed and will show the roots to prove to the owner he’s not just providing a weed “haircut.”

“Gross pay” does not mean yucky money

If you have a teen starting his or her first real summer job, be sure to go over the details of that first paycheque and what all the deductions are for. Explain that early next year you can file a tax return to (hopefully) get a refund on some of the taxes paid out.

What lessons will you try to teach your kids this summer?

 

Disclaimer

The views and opinions expressed in this article are those of the author and do not necessarily reflect that of Chartered Professional Accountants of Canada (CPA Canada).

 

About the Author

Tamar Satov

Managing Editor, CPA magazine
Tamar is a journalist specializing in business, parenting and personal finance. She blogs regularly in this space with advice and anecdotes on her efforts to raise a money-smart kid.

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