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Teaching financial literacy has been my passion. Over the years I've had an opportunity to speak to parents who want to know how to talk to their children about money and want tips to help them become more independent before they go off into the real world. For many parents it seems like just yesterday that your children were on their way to kindergarten, but now that they're in middle school things seem to be happening way too fast. Tweens seem to go from having play dates to group movie dates right in front of your eyes. And they're fashion conscious and brand sensitive far earlier than we ever were. This is all the more reason for us to help them get a financial grip on money and the need for saving by talking to them early and often about ways to save and spend money responsibly. Here are a few things you can do to get your tween ready for the day when you'll need to cut the strings and watch them spread their well-prepared financial wings. Giving your tween an allowance is a great money move. It will help you as a parent reign in their budget-busting requests while teaching them the value of a dollar and saving for the things they really just "must" have. In her book, "Kids and Money: Giving Them the Savvy to Succeed Financially," author Jayne A. Pearl says this about giving your children a fixed spending budget. "Allowance is an effective way to start transmitting to your kids financial literacy, values, and decision-making skills." When tweens have access to money they can better understand the meaning of it and the proper ways to use it. Trying to help them understand the basics of money management using something that they have earned and saved for is powerful. Often that new "thing" they just had to have when you were paying for it becomes less important to them when they come to realize that it will greatly reduce the amount of money they will have left. If your family doesn't embrace the allowance concept but still wants to help your children have first-hand experience with money management, another way to teach tweens about money is through interactive learning experiences and board games such as: Life Payday Monopoly Jr. The Allowance Game and Cashflow for Kids These are all wonderful ways to teach lasting lessons in an entertaining way. Not only will these games help your child strengthen their math and problem solving abilities, they'll also understand basic money concepts. Finally, encourage your children to save with a purpose and if possible offer to add a small percentage to whatever they have saved. This teaches the lesson of compound interest and how money grows if left untouched. The next time your child wants a new bike, skateboard or series of Karate lessons use it as a chance to challenge their desire for what they want by having them save for it. As an extra incentive agree to match their savings dollar for dollar up to a set amount or a specific period of time. The benefit of this to you is that your child will develop discipline and a habit of not spending every dime they get their hands on. Plus, when you make the goal one that's reachable even if they fall short, you can assist them so they will be encouraged to try again next time. The biggest thing to remember is to encourage their new saving habits and find ways to support them so they'll actually think of it as something fun. Once that happens you've created a situation that will develop a positive attitude toward saving for a lifetime!
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