A three-part series on guiding kids from kindergarten through high school.
Part 2: Ages 11-13
As your children reach middle school age, you should start to increase their responsibilities – to help them learn by doing.
Step one: Start to make your children responsible for paying, out of their allowance, more of their daily expenses – school clothes, school lunches, birthday presents – and help them create a budget that allows them to save if they buy wisely. How much money should you give them? Keep track of what you've been spending on their needs and desires over several weeks, and arrive at a reasonable figure that exceeds their weekly or monthly costs by the amount of allowance you intend them to have.
Step two: Have your children set up a savings account, and tell them you'll match every dollar they put in there. The only stipulation is that they can't take out the money you put in. That's earmarked for long-term savings and/or college expenses.
Step three: As you shop for groceries or head to the mall, help your children comparison shop, so they can eventually go out on their own and shop for value. Show them similar items that might have very different price tags. You might also consider using cash for your purchases when you go out with your children. They aren't going to learn very much about money if they see you paying for everything with that magic piece of plastic.
When they get to high school, they'll want to practice managing their own finances. Find out more in Part 3 of our series for Ages 14-17.