Spending and Saving

Teaching Financial Literacy to Middle Schoolers

Teaching your kids financial literacy will help them build solid financial habits that will serve them well later in life.

Teaching your kids financial literacy will help them build solid financial habits that will serve them well later in life. The perfect time to teach them financial literacy is when they are in middle school. At that age, they are old enough to understand the value of money and learn how to use it properly. Here are some ways to teach your middle schoolers financial literacy. 

1. Give Them an Allowance

The first step is giving your child an allowance. That allows them to hold money and use it. When they use up their allowance, please don’t give them more; that will teach them the value of money and why it is crucial to manage a budget properly. 

2. Let Them Earn Money

Many parents decide to let their children earn their allowance by doing chores, completing their homework and school assignments on time, getting to school on time every day, or helping in other ways. Other parents help their middle schoolers make money in other ways, such as setting up a lemonade stand. 

Either way, having your child earn at least some of their money instead of giving it all to them without them working for it will instill a strong work ethic at an early age and help them understand that money doesn’t grow on trees. 

3. Encourage Them to Save

Give your child an allowance on the condition that they save up a percentage of it. They can save up by putting their money in a piggy bank, or you can keep it for them. Some banks even let you open up an account for your child when they are 11 years old. 

However, don’t put everything on a debit card. While you can put your kid’s savings into an online account so they can see it grow in the account’s online dashboard, allowing them to use physical coins and bills will make everything feel more real to them. 

You can then allow them to use a small portion of their savings for something they really want, such as a special toy. That will let them feel the rewards of saving up. 

4. Help Them Budget Their Spending

It’s imperative to help your child understand how to budget. They should track how much money is coming in (typically from their allowance) and how much is going out. You can use a notebook for that or an app. 

They should also be tracking what they are spending money on. You can have your middle schooler classify expenditures under categories such as: 

  • Toys
  • Snacks
  • Electronics
  • Video games
  • Books
  • Clothes

You may be surprised at how well this works. Your child will get an opportunity to see how spending money on less essential items makes it difficult to buy more important things later. 

5. Take Them Shopping

When you go shopping with your child, use the opportunity to help them learn healthy spending habits. For example, you can set a budget for how much you want to spend on a particular grocery shopping trip. Then, ask them to help you decide what to buy. 

This exercise gives them a chance to choose the most important items to buy and select cheaper options to stay within a budget. Comparison shopping will help them understand how to balance needs vs. wants. 

6. Use Games

There are many excellent board games and online games that help children learn and practice financial literacy. PayDay is a perfect video game to start with. 

There are also many apps you can use. Rat Race, which is available on Android and iOS devices, is a financial game for kids that simulates investing, banking, cash flow management, budgeting, spending, and a lot more. It will give kids a chance to learn essential skills they will need as adults. 

Practice is vital for building habits, and Rat Race is the perfect app for that. 

7. Involve Them In Decisions

You can involve your kids in spending and budgeting decisions that come your way. To help your kids learn essential financial skills, you need to be a good role model and show them how you do it. 

Explain to them, in an easy-to-understand way, your reasoning behind your various purchasing decisions. Show them how you are saving up money for retirement and how you are using your income intelligently. Ask them to give their input into how to manage your budget so they can involve themselves mentally in it. 

Teaching your kids financial literacy will pay off well in the long run. By using these seven simple steps, your middle schoolers will be way ahead of their peers in terms of financial literacy. 

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