Helpful Steps for Ages 9-12 with Susan G. Oleari, Market President with BMO Harris Bank

As your kids enter the pre-teen years, you may have noticed they still require plenty of guidance even if they've started asserting their independence. This is especially true when it comes to financial matters. "Ideally, you want to reach the point where your kids can manage their money responsibly," says Susan G. Oleari, Market President with BMO Harris Bank.

Three key money lessons

To help steer your kids in the right direction, Oleari suggests the following tips:

• Give an allowance. Your child is ready for an allowance when he or she begins recognizing money's value. Try giving the same amount each week so your child can get used to budgeting the amount for expenses such as snacks, movie tickets and toys, as well as a small portion to deposit into savings. The allowance should be based on your own finances and how much you think your child needs to spend each week.

"Allowances help kids get familiar with budgeting so as they start making money in their teen and adult years, they know how to spend and save it wisely," says Oleari.

• Teach the difference between needs and wants. Kids sometimes have trouble grasping the difference between things they need and things they want. Help them learn this lesson by using scenarios that are relevant to them. For example, they need to have money to purchase food for lunch. However, a new toy is a want because it's not something that's necessary for living. "Your best strategy is to help your kids understand they need to budget enough money to take care of their needs and the remaining amount can be spent on wants," says Oleari.

• Encourage charitable giving. One of the easiest ways to teach your kids the importance of charitable giving is to include them in volunteer activities you participate in. For example, if you help at a soup kitchen once a week, have your child come along to serve beside you. Once they form a connection with an organization, they'll be more likely to want to help support it with a monetary donation. "Instead of just telling your kids where to put their money, find an organization or cause they feel passionate about and want to get involved with directly," says Oleari.

BMO Harris Bank can help you get your kids off to a good financial start. We offer savings accounts for children that can be opened online or in person. "Opening an account and putting money into it is different than keeping money at home," Oleari says. "This helps kids see their money grow and how much interest they are earning with it."

To learn more, please call 1-800-546-6101 or visit HelpingMakeMoneyMakeSense.com.

Category:

Education

Tags:

• budget
• children and money
• BMO Harris Bank
• Helping Make Money Make Sense
• wants vs. needs
• allowance
• savings account
• helpful steps for parents