Want to teach your kids how to budget their money? Why not make it into a fun, family lesson? Here is one fun idea for how to practice budgeting skills as a family.
Set Up a Store in Your Living Room
Play money can be a great tool for learning about money and practicing budgeting skills. We recommend having a set of play money on hand for this purpose. Not only can you use it to teach kids about the different bills and coins, you can also use it to practice buying things in a financially responsible way. If you don’t want to buy play money, you can always use Monopoly money OR make your own play money.
One way to do this is to set up a fake store in your living room. It can include their favorite food, drinks, toys, games, and books. It can also include things like shoes, clothes, healthy food and drinks, and other not-as-fun essentials. Label everything with a price tag to show how much they cost.
Then, give them each a specific amount of money and tell them that they can spend that money on anything that they want. Let them walk around the room and shop for their selections and then have a chat about what they bought, how much they spent, and how much they had left over.
You can use this activity as a way to have a conversation about how important it is to:
- Plan ahead when you’re shopping.
- Shop for essentials first and wants second.
- Make sure you have money left over for emergencies.
After you’ve given the lesson on budgeting, you could help them to plan out a shopping list based on their budget and then let them have another shot at shopping. Give them a chance to explain their purchases as that can help them to develop that skill of deciding what is worth buying, what is worth saving for, and what isn’t worth buying at all. You could even expand this lesson to include meal planning.
If you wanted to take this one step further, you could have them do odd jobs or chores to earn money to spend in your family shop.
I hope that this fun activity helps your kids learn how to budget their money!