Money lessons to combat summer break boredom

Summer break is a great time to teach kids financial literacy and prevent holiday boredom.

The first step is to teach kids that money does not grow on trees and needs to be earned. A great example of that is setting up a good-old lemonade stand. This will teach them some basic entrepreneurial skills as well as that earning money takes effort, planning and budgeting. Alternatively, they can earn money by having a garage sale of old toys and clothing that are in good condition but no longer used.

The newly earned cash will give them a sense of pride and excitement, and this is a perfect time to teach that there are four things they can do with their money: save, donate, invest and spend.

SAVE

Explain the importance of saving. Teach them the “pay yourself first” principle by having them save a portion of earned money before spending the rest. This is the number one rule of all financially successful people. 

DONATE

You can teach them about donating by having them donate the unsold items from the garage sale to a charity. It is important to instil a sense of gratitude and teach them to be thankful for all that they have. Explain that, even though they may not want the old toys and clothing, these still have value and will be enjoyed by less fortunate children. 

INVEST

The rest of the earned money can be invested or spent. There are various ways to teach them about investing. Together you can research a company that they like. It should be a company whose products they use such as Toys R Us, Apple or McDonald’s. You can help them buy a company stock and together you can follow its performance. 

SPEND

If they want to spend the money, like most kids do, teach them how to spend wisely and to be a smart consumer. Teach them to price-compare, as well as price-match. I love using the Flip app on my phone to buy smart. My son wanted to purchase a Lego set with his money. We used the Flip app and found a store that was having a promotion on Lego that week, and he bought the Lego set for less. If your kids want to spend their money on technology, nudge them to consider used or refurbished products. A couple of years ago my family bought a Wii on Kijiji, with several games and a fitness board, for half the price of the new Wii. You can also find many local stores that sell refurbished electronics with a warranty.

The last lesson of financial literacy is that money is very important, but not the most important thing in our lives. Teach them that the most important things in life are given to us for free, such as our health, family and friends.

Keep the conversation going

Do you have any tips on teaching kids financial literacy? Post a comment below.

Disclaimer

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

 

About the Author

Maya Kuc Corbic, CPA, CA

Dinarii Financial Education Academy
Maya is a passionate advocate of financial literacy and is the founder of Dinarii Financial Education Academy. The academy’s mission is to teach children and youth financial literacy skills in a fun and engaging way, and give tools to parents to continue teaching personal finance at home. Dinarii offers student and parent workshops that qualify for the Parents Reaching Out Grant.