Savvy parents! When Christmas is just around the corner, and it’s time for festive cheer, it’s also a golden opportunity to teach your little ones some valuable lessons about money. At Marmalade Lion, we believe in making learning fun and practical. From one parent to another, these are some simple, hands-on ways to introduce your kids to money management this holiday season.
Set a Christmas Budget Together
Before you start decking the halls, sit down as a family and discuss how much you’re comfortable spending on gifts, food, and decorations. Have the little ones around as you discuss the seasonal budget with your partner. While keeping the conversation about spending positive and constructive, explain out loud what the total amount is, and how you will make the best attempt to find the best presents for everyone with this amount. This helps them understand budgeting and prioritising needs over wants, without a mindset of lacking.
If you begin seeing a definitive lack in your budget, show your children how you will work through it with your partner.
An example – “Our budget for Christmas hampers is X, but the actual cost is Y. It seems we will send out little homemade gift boxes with their most favourite things instead this year.”
Try to walk your kids through your budget brainstorming in a creative and constructive way.
Create a Christmas Wishlist with a Twist
Encourage your kids to make a wishlist for Christmas – what they’d love to do, and what they’d love to get as Christmas gifts – but with a twist. If your kids are old enough to understand it, ask them to categorise items into 'wants' and 'needs'. This exercise teaches them the difference between essential items and those that are nice to have. It also helps them practice delayed gratification and understand that not everything can be obtained immediately – that procuring some things might take some well-expended effort.
If your kids are very young, let them observe you work through this process.
Use the 'Save, Spend, Share' Jars
Introduce the concept of saving, spending, and sharing by setting up three jars or envelopes. Label them accordingly and encourage your kids to divide their pocket money or any Christmas gifts they receive into these categories. This visual method makes abstract concepts tangible and teaches them to manage money responsibly.
Go Shopping with a Purpose
Take your kids shopping with a clear purpose – to buy gifts that you planned and budgeted for. Give them a small amount of money and let them make choices. But don’t try to push them. Let it be an enjoyable experience of finding the most fun things with the amount they have. If you don’t have an extensive budget to experiment with, let your kids get involved while the family shops.
This real-world experience helps them understand the value of money, compare prices, and make informed decisions. Plus, it's a great way to practice counting change and handling cash.
Discuss the Cost of Living
If your child is at least 10 years-old, use everyday expenses as teaching moments. For instance, when paying for groceries or bills, explain that work goes into earning the money to cover these costs. This helps children grasp the connection between work and income, fostering a deeper appreciation for money.
Teach Money Management with Games
Turn learning into fun with board games like Moneywise Kids or Money Bags. These games simulate real-life financial scenarios and teach kids about saving, spending, and investing in an engaging way. They're perfect for family game nights and spark meaningful discussions about money.
Encourage Handmade Gifts
This Christmas, encourage your kids to create handmade gifts. It could be a drawing, a knitted scarf, or a baked treat, making gifts teaches them the value of effort and thoughtfulness over easy buying. It also fosters creativity and a sense of accomplishment.
Share Stories with Financial Lessons
Read books that incorporate financial lessons into their stories. Titles like The Berenstain Bears’ Trouble with Money or Rock, Brock, and the Savings Shock are entertaining and educational. After reading, discuss the lessons learned and how they apply to real life.
Open a Savings Account
If your child is old enough, consider opening a savings account for them. This introduces them to the banking system and the concept of earning interest. Regularly review the account together to track progress and discuss saving goals.
Lead by Example
Children often mimic adult behaviour. Demonstrate good money habits by discussing your own budgeting, saving, and spending choices. Share your financial goals and the steps you're taking to achieve them. This transparency builds trust and reinforces the lessons you're teaching.
Christmas is more than just a time for giving physical gifts – it's an opportunity to impart the gift of valuable life skills to your children. By integrating these simple strategies into your holiday preparations, you can teach your kids about money management in a fun and meaningful way. Remember, the goal isn't to make them financial experts overnight but to lay the groundwork for responsible financial habits that will benefit them throughout their lives.
Happy holidays from the Marmalade Lion family to yours!
