Summer School For Parents

Summer School For Parents

Teaching your children about money

With the school year behind us, you’re probably looking for ways to keep your kids entertained and engaged. While children enjoy their summer, this break is also a great time for them to learn a little about handling money. Teaching your children about managing money introduces them to responsibility at a young age and sets them up for success as adults.

Here are a few things you can do with your children while they are young to prepare them up for financial success.

  1. Show Them How to Plan

As parents, we can use everyday situations, such as meal planning and grocery shopping, to introduce money concepts in a way that children will understand.


Help them decide what to serve the family for dinner. As they choose the entree, side dishes, and dessert, they can learn about what comprises a healthy diet.  With a menu in hand, they can learn about groceries and write out their shopping list. Help them estimate what the food will cost, then let them shop for the ingredients. Once you’re back from the store, they can compare the actual food costs to your estimate (an exercise in budgeting). If the child is old enough, they could even help prepare the family meal. Everyone enjoys eating the fruit of their own labor!


  1. Let Them Earn Money

Younger children can earn money by doing chores. As they get older, your children may show interest in a lemonade stand or making items to sell on Etsy.  Not every child will be an entrepreneur, but all can learn to make money by serving others. As they become old enough to be employed, they can take on a part-time job, learning to balance work and school. 


  1. Let Them Open a Savings Account

Opening a savings account can instill a healthy habit of saving from an early age. When your child receives money, whether it’s from allowances, gifts, or earnings, lead them to save a portion of it for later. Watching their savings grow as time passes can be powerful lessons in both patience and purchasing power.


Involve your children by taking them to the bank to open the account and making the deposits into their new savings account themselves. When they receive a statement in their name, they develop a sense of ownership of intangible assets.


  1. Show Your Children How to Spend

You can help your children prioritize expenses by letting them choose how to spend their own money. This decision-making process involves how much to save for later and allowing them to decide how to spend the rest. As they get older, giving them responsibility over certain expenses, such as paying for their own clothing, allows them to develop important skills that will serve them well throughout their lives.


  1. Introduce Children to Credit Scores

As your children enter the working world or go to college, their banking needs will increase. Help them demystify how their money behavior affects their access to cash and credit. It may seem like a complex topic for young adults, but far too many youths and their parents learn the hard way. Show them how credit scores are influenced by banking and spending behavior. Encouraging children to be mindful of their financial behavior will set them on the path to building a strong credit history.


  1. Introduce Them to Tax-Advantaged Savings

Individual or employer-sponsored retirement plans are not limited to adults.  When your children are old enough to get a job, they can begin a retirement account. While the idea of retiring at the beginning of their work life may seem like a long time from the age of sixteen or seventeen, they can learn some valuable lessons about income taxes. Retirement accounts will give our youth a primer in deductions from taxable income, tax-deferred savings, employer matching, and tax penalties.



School’s Out, But Money Matters

So…school’s out for summer! You probably have many fun activities planned for the weeks ahead. Use some of these activities to expose your children to money matters. By teaching financial literacy, you will be introducing them to a grown-up kind of responsibility. You may be surprised how interested they are in learning more about it. Soon enough, it’ll be time to buy a car, pay for college, or even a house. They do grow up quickly. Teach them a few more things they may never learn in school!

Woodlands Tax serves the families of our community with a variety of tax compliance and tax planning services.  We’ll even represent you to the IRS. If you need to see a tax advisor, please visit our contact page to schedule a consultation today!