7 tips for raising financially savvy kids

We've all heard horror stories about kids who go off to college with shiny new credit cards and run up mountains of debt over the first several months. That won't happen to your kids, thanks to these tips:

• If your kids only see you withdrawing those 20-dollar bills from the ATM, they're going to think machines hand out money.
• Make sure they also see you depositing funds.

• Label a jar with a set amount of money to be used for something specific. Start small — say, five dollars to buy some ice cream and sprinkles.
• Collect five dollars worth of change in the jar and count it out before buying the treat.
• Keep this money separate when you go to the store, so your child can buy the ice cream himself with the cash.

• You need shoes, but you want the trendiest brand. You need food; you want to eat out.
• Apply this rule to anything you buy and to any of their requests for new things.

• Instead of saying, "we can't afford that," "that's too expensive," or just saying no, substitute a comment that expresses an intentional choice.
• Instead of feeling that "no" means sacrifice, scarcity or embarrassment, children learn that life is about making choices.

Examples:

• "I want to stay home and visit state parks this year so we can save for a special vacation next year."
• "I choose to bring my coffee [or water, or soft drink] with me and not buy it at the convenience store so I can save that money for more important things."

• In addition to using a change jar to save for special treats, let your kids hear you talk about saving for a new roof, paying off the car, putting money aside to celebrate a birthday, saving for their education and paying bills on time.

• Along with that jar for ice cream, label another jar for charity.
• Make sure your children put a fixed percentage of their earnings and allowance in it.
• Make sure they see you giving to others, whether it's tithing to the church, writing a cheque to a charity or volunteering for a charitable cause.

• Keep TV time to a minimum to avoid the "buy me" ads that dominate.
• Also, point out the marketing tricks that advertisers use, and make sure your kids understand how sellers try to sell.

Raising your kids to know how to budget and deal with money is one of the most important skills they can have when they go off into the world. Be sure to incorporate these tips throughout their childhood so they will understand the value of money as an adult.