Featured guest post: Sarah VanHoose, offers clients encouragement and accountability through her online coaching business, Journey to Influence. As a trained Ramsey Preferred Finance Coach, she makes money stuff simple and easy to understand.
If you’re anything like me, there are countless tips you wish your parents had taught you about money as a kid. In this post, I’ll share with you simple and effective ways for kids to earn, invest and save money like a pro.
You’re Committed to Teaching Your Kids About Money
Remember how you were always on the lookout for ways to earn money? There were risks and consequences when you considered selling the hostess cupcake pack in your school lunch or your brother’s Sony Discman without him knowing.
Now that you are a parent, you’re determined to make sure your kids are aware of risks and harm from tweezing their brows too much, falling for the guy in high school with a TAZ tattoo on his back, and forgetting to return those Blockbuster movies on time. Just me?
See, you’re committed. From the moment you held them in our arms. Committed to loving them with every ounce of your being, teaching them all you know, and committed to helping them get as much out of life as humanly possible.
Were You Naive About Money as a Kid?
I’m going out on a limb here. Tell me if I’m wrong, but like me, you didn’t learn all the things you needed to know about money as a teen or young adult. So, without a care in the world, you leaped into adulthood completely oblivious to how naïve you were about real life. There were lots of learning curves, a few mistakes we won’t mention – and unfortunately, for many, a pile of debt that you’re clearing up even now.
Money, Kids and The Hard Knock Life of Employment
Let’s commit to helping our kids start out with more education and understanding than we had regarding money management.
And it all starts with one thing…. a job!
Yep, that’s where it all begins – and you know a thing or two about jobs. I bet you’re a pro in your career of choice and understand exactly what it takes to earn a paycheck regularly.
So, why should your sweet kiddo enter the hard-knock life of employment at a youthful age? Because well, that’s real life, my friend. What better way to help prepare them than to them let them experience how it works.
10 Ways Your Kids Can Earn Money
With that being said, I’m going to share with you ten simple ways your kids can learn to earn, invest, and save money. We’re going back to the basics folks. The time-tested money lessons you and I should have learned… well, we’ll just say, “years ago”
1. Commission Based Chore Chart
Yes! Your kids can finally do a few chores around the house. Have you ever heard of a commission-based chore chart? If not, I highly recommend this as introduced by Dave Ramsey with Financial Peace Jr. for kids.
You may say, “my kids already get an allowance.” Here’s the deal. An allowance is simply a dole out of X dollars to kids by parents regularly. There may be chores, there may not be – but your kids are losing the correlation between chores and money in translation.
How Commission-Based Chores Works and Why Kids Love it.
Your kids begin by tracking chores they completed. They receive a paycheck on ‘payday’ for the work they did.
Work = money. No work = no money.
A full chart showing lots of chores done = more money. A little work = less money.
Simple as that.
Kids are Great at Washing Dishes
My daughters are now 8 and 11 years old, and I’m happy to pay out their commissions for the work they helped with around the house.
FINALLY, I am no longer a slave to the dishes.
I’m not loading or unloading. And I’m very willing to pay seventy-five cents per load and fifty cents to unload to have a clean kitchen and 20 minutes back of my life!
Don’t Pay Your Kids for Every Chore
Now don’t get me wrong! Not all household chores come at a rate. Things like cleaning your room, and feeding your own pet come as simply responsibilities for keeping residence here. There has to be a balance, or you end up raising kids that won’t lift a finger unless you are handing them cash.
2. Pet Care Jobs for Kids Close to Home
Caring for pets is quite a responsibility. Often, friends and neighbors may need support caring for their pets as well.
Gone on vacation? Visiting Grandma? Your kids can feed the pets, spend a little time giving them some love and ensure the water bowl has fresh water.
For the older child with strong arms and a love for dogs, there’s always dog walking! Keeping the business just in your neighborhood alone can provide opportunities regularly and still keep them close to home.
3. Older Kids Can Be Mother’s Helper
This is a new concept for me. I didn’t realize that a young child could be helpful around the house with parents still at home. Silly me! A dear friend of mine is a mother to five young children and, knowing that my oldest had recently completed her babysitting training course, asked if she’d be available as a mother’s helper. This is essentially…. “helping a momma out.” They could simply hold the baby or do small chores around the house, helping to keep the toddlers out of trouble, or assisting with a craft project.
4. Babysitting Jobs for Kids
For the child ready to graduate from mother’s helper, there’s the traditional babysitting job. Your house, their house, one kid, four kids, date night or workday. The mix is endless, and babysitting is still in high demand, just like when we were teens. Although the going rate is far more lucrative than the $5 per day, I received for my first gig. Why is it that some of the most important jobs want to pay the least?
Set your child up for success by enrolling them in a training course to get the basics and take ownership of the responsibility of caring for children. Not for the faint of heart, as you know. Many times, the YMCA offers a babysitting course and first aid certification.
5. Kids Baking Has Never Been Sweeter
Cookies? Banana bread? Cake pops? If your child enjoys being in the kitchen, and you have shared the difference between the TBSP and the tsp, then perhaps you can unleash them in the kitchen for a fun bake-off, turned bake sale. You know their grandparents will be their first customers, and before too long you could have folks knocking on the door wondering when the Friday cookies will be ready.
This is a more advanced ‘role’ but not only helps teach a real-life cooking lesson but also the basics of sales and marketing. Imagine filling the mailboxes in your neighborhood with DIY signs, cute little gel pen drawings, and fair pricing for homemade treats.
A Delicious Payday for Kids
Once a week? Once a month? You can guide your little entrepreneur as they bake their way to a nice, delicious payday while making one heck of a mess in your kitchen.
Note to self: check the chore chart above, to confirm someone has dish duty before agreeing to this.
6. Yard Maintenance
If your kid is trustworthy with a mower at your house, your neighbors may need help as well and be willing to pay for services. Not ready for mowing? Weed pulling is always in high demand in my place. Send them my way!
Let’s face it, grown-ups are busy and unless someone has yard maintenance as their love language, it’s not mowed as often as it should unless it’s hired out. Your kid will have regular and recurring customers, especially at their price point.
7. Yard Sale or Sidewalk Stand
Lemonade, iced tea, Cookies, fidgets, Pokémon Cards? Whatever sale they can run on their own in the yard or on the sidewalk to hustle a little dough. Heck, they can have their own mini yard sale with the toys they don’t use anymore. Let them organize it and take their proceeds all the way to the bank.
8. Kids, Money, and Car Washing
I hope you have friendly neighbors because when they see your kids doing a Saturday car wash, they’ll be over! If you trust your older kids with a hose and a sponge, they can knock on a few doors, and they’ll get a few takers to have their car washed. Waxing might push it, but a good cleaning with only a few missing areas is probably worth a Hamilton, right?
9. Trending Arts & Crafts Sale
Does your child have a talent for making Perler bead magnets or friendship bracelets? List those items for sale! Or take them to that stand mentioned above. Let them use their knack for arts and crafts to their advantage and make a few extra bucks.
10. Big Project-Big Payday
Similar to the chore chart, this is often an “at home” item that is rare in nature – but potentially worth big bucks. Spring cleaning the garage or washing the cars inside and out are not regular occurrences in our household but can be eligible for a nice payday every so often.
But that’s not all.
Now you and your kiddo have some interviews prep to do. Kidding! But you have a great jumping-off point for a discussion about their first job.
How to Teach Your Kids Money Management
Okay, so a job is not the only part of proper money management. In fact, it doesn’t show you how to manage the money at all – but it gives you some money to mismanage! Right? Simply put, we learn by doing well or not so well.
The lesson that’s next on the docket for your kiddo?
Setting goals (for savings), having self-control (for spending) and realizing that this world is so much bigger than self (giving).
10% (plus or minus) to charity or cause of choice.
Do you attend a local church? That’s a wonderful place to donate but explain what the money goes to support…it’s not directly to God himself.
Is your child enthusiastic about pets? The local humane society would be a good fit. Does your kiddo have a heart for the homeless community? Use their giving money to buy bottles of water and granola bars or clean socks to hand out from the car.
When your child can see what good comes from sharing a bit of their own money, the world becomes a better place.
Parent check. Are you practicing charitable giving? Even if you start with a small percentage or dollar amount to a local charity or buy a handful of clearance winter coats to donate to a foster kid coat drive – it’ll make a difference; not only for the recipient – but for you, too.
50% of Your Child’s Money Should Go to a Savings Goal.
Something big-ish, all age-dependent, and parent-approved of course – this should be something that they’ve been eyeing or asking for and will take several weeks (months even) to get that amount.
Realizing that not everything just magically appears when we want it is an important lesson. We have to wait. And wait and wait sometimes. Waiting sucks. I don’t care if you’re 7 or 47. Getting into the habit of normalizing waiting will give your child the skill and muscle memory to save for larger purchases as an adult as well.
Did anyone else buy a Bow flex on credit in their twenties? No? Well, good for you.
My youngest daughter saved for months for a hoverboard. She takes care of it better than any other trike, bike, or other wheeled devices she’s had – because she bought it with her own hard-earned money.
50% of the Remaining Money Your Kid Earns Should be Spent.
What should they spend the remaining funds on? Whatever their little heart desires. Try not to put too much restriction on this. This “freedom” to spend instills the idea that when you work, you get paid money and when you get money – you can buy stuff with it.
Advice About Money and Kids from the Experts
Cameron Huddleston agrees with me as well and shared as much in an article contributed to Forbes about how to teach your child good money habits. “Kids need to have money of their own so they can learn how to decide about using it.”
Money is a tool to get things, plain and simple. As we become adults, things involving money are far less fun – like utilities and insurance. But they certainly can be fun, like vacations, home decor, and Apple products. We decide daily how we’re going to spend money based on what is most important to us.
Let Your Kids Decide How They Spend Their Money
Parental support. Splitting up the money into the 10/50/50 division doesn’t need to be a challenging task. Round up or down, but don’t make this too complicated. Let your child decide if they want to put more toward saving or spending if one amount is larger than the other, and don’t worry about busting out your coin purse to make the exact percentages.
$1 – Giving
$6 – Save (or Spend)
$5 – Spend (or Save)
The Envelope System Helps Kids Visually See Their Money
Have your child place their money in three distinct envelopes or areas so that they don’t forget because that’s a legit issue. Label those envelopes with the name of what they’re saving for, or the charity to which they’ll be contributing. Make it visible and real.
I hope that you’re feeling prepared and confident to help your kid launch into the world of making and managing their money.
Want to Learn How to Save “Grown-up” Dough?
Hey mom, if you are interested in saving a bit of grown-up dough of your own; check out my free resource 65 Ways to Save on my website. www.myjourneytoinfluence.com
Sarah VanHoose is a personal finance coach.
She’s focused on helping families stress less about their money by creating a specific plan for them and walking them through it. Clients find encouraging accountability through her online coaching business, Journey to Influence. As a trained Ramsey Preferred Finance Coach, she makes money stuff simple and easy to understand – going back to the basics. Sarah’s background is as a leader in a large healthcare organization. She and her husband James and two daughters live in Portland, OR.