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This is especially helpful if you're also trying to teach them to help cut down on expenses. Show them how much money you earn each week and explain that they can't spend more than that amount. This step requires quite a bit of trust. Explain to your child that details of the family budget should not be discussed outside the family. Have them look in the kitchen cabinets and refrigerator to figure out what the family needs for the coming week. Then, review the list with them before going to the grocery store. While shopping, hand them a calculator to see how close you are to your budget as you add more items to the shopping cart. If money is tight, try planning your meals around what's on sale and which coupons are available. Have your child look through store circulars and help you clip coupons. At the store, ask your child to find unit prices on items. Have them divide the price by the net weight or number of contents in the package. This will help them to become more frugal shoppers. For example, a 5-oz. bag of chips costs $3, while a 10-oz. bag costs $5. If your child does the math, they'll find that the $5 bag is the better bargain at $0.50 per ounce (as opposed to the $0.60 per ounce on the $3 bag). Explain what they can and can't buy based on how much they've saved. Tell them that they might have to wait to buy the things they don't really need if they come up short. Turn it into a math lesson as an educational bonus. For example, their account balance is $100, but they want a $60 video game and a $50 jacket. After some simple addition, they'll discover that they don't have enough money for both. They'll have to choose one or the other. Consider it a reward for doing their chores. Tell them that if they want to save up for shoes before the store's sale ends, they'll have to work harder for the money. This will teach them that they must earn money and not just expect it to come out of nowhere. Assign a different monetary value to each chore. It might help to pay more for the less appealing chores. Let's say your child hates washing the dishes but doesn't mind mowing the lawn. Pay them $1 more for dishwashing. You can also encourage your child to look for ways to earn money outside of the house, such as by mowing the neighbor's lawn, shoveling snow out of driveways, or pet sitting. Brainstorm with your child to help them come up with some potential money making options.
Review the family budget with your children. Let them help with the shopping list. Teach them to comparison shop. Make a spending plan. Have them work for their allowance.