How to teach your kids responsible spending

September 6, 2011 3:11:12 PM PDT
More than half of families say their kids get a failing grade when it comes to responsible spending. And it gets worse during back to school and fall months when the 'must have' list grows each day.

Up until they start earning a living and sometimes beyond that, many kids spend money like it grows on trees. That's why it's important to get the message across to your kids about responsible spending as early as possible.

He is just three years old, but Sara Fernandez is already teaching her son the importance of money.

"So right now, we are just introducing the concept that you have to work to earn money, that things are not free," Fernandez said.

And introducing that concept is easy at Kidtropolis located inside the Children's Museum of Houston. It's a city for kids, run by kids. And just like the real world, if you want to spend money, you have to make money. That means you have to get a job; something that some moms are already implementing at home.

"She has little chores that she performs around the house so she understands that she's working for something," said parent Zelma Lee.

She is the founder of, a best-selling author and a renowned parenting expert. She says the first thing you must to do to teach responsible spending to kids is to is start early.

"Even when kids are young, giving them a dollar in the grocery store and asking them what they are going to buy with that dollar," Debroff said.

This will give you an idea of your kids "spending" personality.

"There is a kid who says I am going to hold onto it and save it and there are the kids that are already giving you signals of their teenage years because they can't spend their allowance fast enough," Debroff said.

Begin by teaching kids early on that money is earned; you can do this by giving them an allowance.

"For very little kids all the way up to the grown up kids, we want them to understand the value of money," said Debroff.

Next, teach them the power of saving for a rainy day or for a big ticket item before you introduce spending.

"The first goal is for him to understand what money is and how you can get it and give it and use it, and the next step would be financial responsibility," Debroff said.

At the Children's Museum, kids get an ATM card with $40 of play money to spend wherever they want -- the vet, the diner or the grocery store.

For teens ages 13 to 18, depending on their maturity, Debroff suggests giving teens a credit card with limits.

"I got them an express charge card that's tied to my gold card and I can set custom limits online," Debroff said.

She says that lesson will give kids responsibility in managing credit.

For more information about Stacy Debroff and her tips, visit her website at

We had a couple of parents chime in on our Facebook page today -- one of our parents said they like to encourage 10 percent of their earnings to charity and another parent is already teaching her kids couponing.

Now some parents may not be a fan of an allowance, so we have other suggestions -- let them save adults spare change in a piggy bank or let them save money by doing chores or mowing yards.

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