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Budgeting: A Teachable Moment with my Pre-Teen

What are you teaching your kids about money?

Have you considered what lessons you want your children to learn about money? As a financial advisor who works with people on some deeply ingrained money issues, I have thought A LOT about what I want my kids to learn about money. The thing is, if you don't think about it in advance, you could miss some great teachable moments.

My kids are all getting to the age where they are having a better understanding of money. Even at such a young age, they all seem to have a unique relationship with money. If I could share one ounce of wisdom with them, it's that they are in control of their own financial situation. It's interesting, though. My youngest, who is seven, seems to have the clearest concept of money. My daughter, who is ten, spends money the instant she gets it. I don't think she cares what she spends it on. She just loves to spend money.

My oldest, who is 12, is just starting to get the picture. I will say that his experience with Boy Scouts has had a lot to do with that, for which, I am grateful. Each boy has a scout account. When they do fundraising activities, a portion of the funds they raise goes into their scout account. They can use the accounts for various scouting activities like camping. 

Yesterday, my oldest son, who is 12, was getting ready for a camping trip with his Boy Scouts Troop. They're going caving in Kentucky this weekend, about five hours from where we live. The boys were told to bring money because they'll be stopping for dinner on the way down. Here's how our conversation went.

For more about kids and  money, check out our related posts:

How to Be a Positive Money Role Model for Your Kids

Allowance. To give or not to give? That is the question.

A Conversation About Budgeting with my Pre-Teen

Mom: Here's $10 for dinner. Make sure you put it somewhere you won't lose it.

J: Thanks. I hope we don't go to a sit-down restaurant. I won't have enough money for dinner if we do.

Mom: I doubt you're going to a sit-down restaurant with your whole troop, but if you do, you can make $10 work. Just because you're at a restaurant doesn't mean you have to get the most expensive thing on the menu.

J: I remember when we went to Cedar Point last fall. We stopped at the Melt (a casual sit-down restaurant) on the way back, and $10 wouldn't have been enough. I didn't even have enough for dinner at that time. [One of the parents] had to pay my bill.

Mom: That's interesting. I've eaten at Melt for less than $10. You have to be selective, but if you know you only have $10, you order something that costs less than that. But keep in mind, if you're at a restaurant, you also need to cover tax and tip. I would recommend ordering something under $7.50, so you know you'll have enough.

J: It's really easy to spend a lot of money, isn't it? 

Mom: If you're not paying attention, it's very easy to blow through all your money. Is that what happened when you went to Cedar Point last year?

J: Yes. I was also trying to help out a friend who didn't have any money, so I was ordering stuff that would be big enough for us to share. But then I ran out of money.

Mom: That's why we don't just buy everything you kids ask for. We have to keep in mind what's most important when we're deciding what to spend money on. We also save money, so we have money to do things that cost more like to go on vacations.

J: So, you really think I can cover dinner for $10?

Mom: I know you can cover dinner for $10. You just have to be thoughtful about your selections. Let's say the food costs a little more where you go then you can order water to drink so you're not paying for a beverage, too.

J: I hate drinking water.

Mom: If the drink is that important, then get food that costs less. You have to decide what's most important to you. You're in control when it comes to how you choose to spend your money. 

[His ride came, and the conversation ended.]

Reflecting on Our Conversation About Budgeting

As a parent, I'll be honest. I overanalyze everything. I'm always second-guessing myself and reflecting on my conversations with my kids. Even though I'm doing the best I can, I feel like the only way I'll continue to grow and get better is by considering how I might do things the same or differently in the future.

I recognize that $10 is not a ton of money for dinner, but I do genuinely believe it's enough. We live in Ohio, and I don't think they were stopping for steak and lobster on their way down to camping. Still, even some fast-food restaurants nowadays can run you more than $10 per person if you're not careful. I know he was angling for me to give him more money, but I would much rather see him learn to use what we provide him wisely.

Related post: How to Create a Household Budget

Financial Literacy - Sharing the Vocabulary

Reflecting on our conversation, I think I could've handled a few things a little differently. For one, I never used the word "budgeting" when we talked about it. I think that could have been a miss on my part. I'll probably ask him how dinner went with his $10 when he gets home and try to bring up the word then. I don't want my kids to grow up thinking budgeting is a bad thing. I want them to grow up knowing that budgeting is just part of spending responsibly.

If you need help with your own financial literacy before you try teaching your kids, check out our online course: Budgeting a New You.

Making Your Money Last

I think I also could've given him some other ideas about how to make his $10 go farther. For example, when we take a road trip, we rarely buy food out, and if we do, it's generally not a whole meal. We always pack a cooler with lots of drinks, stuff for sandwiches, and snacks. In hindsight, I would've recommended that he pack some food if he was worried about not having enough money.

Feeding a Family of Five

I also could have given him a little more perspective on the value of $10. When I cook dinner for my family of 5, I try to keep the entire dinner under $10 for all of us. That's the only way I can manage to have a reasonable food budget. I'm not always successful, and we do splurge from time-to-time, but the vast majority of our dinners cost less than $2 per person to prepare. I will have him help me come up with a menu one week so he can see for himself.

There's always more we can teach our kids. I think these moments are so important, though. It's in these moments when kids learn the value of money, they learn how to spend responsibly, and they learn that they are in control. He may not remember our actual conversation, but I'm sure it won't be our last.

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For more about kids and  money, check out our related posts:

How to Be a Positive Money Role Model for Your Kids

Allowance. To give or not to give? That is the question.

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