We’ve landed on eight. Eight is the perfect age to start budgeting with your kids.
They are old enough to understand, to learn from mistakes, to benefit from good choices. You can’t just throw them to the wolves, of course, you have to work with them on it quite a bit, but eight has been the magic number for us.
This is how we do it: Set up a separate budget for, in our case Porter, Lydia, and Harrison. (Max, Rose, and Faye, your time will come!) This isn’t a sneaky way to get you subscribe to another YNAB account. You can just use your same account and create new budgets.
At first, I focus on just one principle: Give 10 percent. Of the remaining 90 percent, save half and spend half. It’s stripped way down, but my kids don’t know any different, so we are getting away with it for now. Hopefully, they do not read this blog post.
You set up the budget and it goes something like this: “Hey, this money is available at the top—$25.11. We need to save 10%. What’s 10% of $25.19? Oh, it’s $2.52, okay let’s put that in our Giving Category.” You’re teaching them that little Math, then you’ll discuss dividing the rest in half between Savings, and whatever they want. This is where the real magic happens.
What Do You Want To Do With The Rest?
You’ll ask. As they bring up different things, your job is to just keep asking, probing, pushing,… “What about that thing you said the other day? You mentioned something about fidget spinners or did you say something about little magnetic balls and how fun those are? Weren’t you talking about kinetic sand? Wasn’t there a Ninjago Lego set?” You just keep going.
You get the list really long. Get everything out. And then you look back at the available and ask them again, “So, what do you want to do with the money?” It’s awesome to watch because your kid will prioritize fantastically.
Prioritizing Is The Natural Next Step
It’s so interesting because kids are naturally really good at prioritizing. Far better than us adults, in many cases, because we don’t have the same luxuries. We can’t say that travel is our top priority, so we won’t pay our bills. They can put all their weight behind one goal, whatever it is. And there is a lot of power in that singular focus.
So, get going with your kids. Set them up with a budget. Work with them on it. And watch them start to really understand how money works. Don’t you wish someone had taught you when you were eight? Exactly.
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Your Next Step
Budgeting is not restrictive. You won’t be spending less, you’ll be spending right. So what do you have to lose? Except all that debt and stress?