1. Life isn’t about stuff.  The most impor­tant les­son a child needs to learn to lead a healthy mon­ey life is that stuff isn’t the most impor­tant thing.  A great way to teach this to your chil­dren is to lead by exam­ple, and have con­ver­sa­tions with your kids about what their per­cep­tions of rich and poor are. It’s some­times shock­ing what comes out.  Anoth­er way to instill this impor­tant prin­ci­ple is by giv­ing gifts for birth­days & oth­er spe­cial events that aren’t things but mem­o­ries to make.   A fam­i­ly play day at a park, or host­ing a sleep over for friends.
  2. Mon­ey is earned!  Kids have a com­plete­ly abstract con­cept of mon­ey.  They need or want some­thing and mon­ey appears to acquire what­ev­er that some­thing might be.  Instead of just pur­chas­ing some­thing for your child make them earn it.  Every­day they make their bed, take out the trash, or put their toys away they earn mon­ey toward their new toy.
  3. You can’t always get what you want.  Instant grat­i­fi­ca­tion is not just a prob­lem for chil­dren.  Many adults have to deal with it too.  This is why so many peo­ple end up with moun­tains of cred­it card debt.  Instead of buy­ing them a new video game when they see it in the store make them wait a week and see if they still real­ly want it.  Most of the time they have already for­got­ten about it.
  4. Save for big tick­et items.  Too many adults rely on cred­it to buy a new big screen TV.  If they want a new bike have them save for it. Get your child a sav­ings account. ING has a free one online.  See if they will start sav­ing on their own, and as an extra incen­tive match what they save.  Every month sit down and look at how much they have saved, how close they are to their goal and how much inter­est they have earned.
  5. Have a rainy day fund.  My moth­er always said, “keep a quar­ter in your pock­et so you can call home.” This is obso­lete now, but the idea is still impor­tant.  This is a hard les­son to teach chil­dren since we want to make sure our chil­dren are tak­en care of.  But next time the unex­pect­ed hap­pens, the air con­di­tion­er breaks or the car needs repaired sit your chil­dren down and talk to them about how you finan­cial­ly deal with the unexpected.