Teaching your kids about budgeting is as simple as your grandmother’s homemade lemonade recipe.

If you want your kids to be financially prepared for their adult lives but don’t know where to begin, here are some simple steps for introducing them to budgeting money.

Basics of Budgeting

So, your kid receives a monthly allowance, got a birthday check from their uncle or is old enough to have a part-time job at the local ice cream parlor, they can start a budget!

Step One: Keep Your Money in a Safe Place

Whether it’s a piggy bank or a savings account at your credit union, it’s never too early to keep your child’s money in a secure location and track how much your child has.

Say your 8-year-old might have a piggy bank for spare change. Help them set up a weekly chart to tally the amount in their bank and record it.

Step Two: Planning for Purchases

If there’s a new toy they’ve got to have or they want to choose a piece of candy at the store, support them by monitoring:

• The item’s cost
• The savings in their piggy bank or wherever else they keep their money
• The estimated time needed to save enough money to purchase the item

But, how do you save up money for a purchase? That’s where this last step comes in.

Step Three: The Art of Saving

The easiest way to encourage your child and help them save up their money for something they want to buy is as soon as they receive a birthday check or an allowance for completing their weekly chores, help them set aside a percentage of it into their piggy bank.

As they keep adding money to their savings, they will see it grow over time, and before they know it, they’ll be able to buy that new toy or video game!

Looking for a Creative Way to Put Budgeting in Action?

Summertime is right around the corner, and your kid may be looking for ways to earn extra cash. How about a lemonade stand?

Budgeting can help here, too!

By learning to budget, your child can:

• Plan for the supplies they need to purchase
• Compare prices to find a balance between being budget-friendly and delivering a quality product
• Determine how much to price their lemonade per cup to ensure a profit.

Check out our Lemonade Stand Budgeting Activity and discover how sweet budgeting can be!