With a little planning, you can turn the dreaded back-to-school shopping headache into an educational experience for you and your child. As soon as the back-to-school sale ads hit the newspapers, financial experts remind shoppers to stay within budget and talk to children about spending limits. However, many parents admit that their own lack of knowledge hinders them from having the budget talk with their children.
Here are some tips on how to turn back-to-school shopping into a mini-lesson on budgeting:
Set a realistic budget before you set foot in the stores.
Help your children prepare a back-to-school budget.
Take a printout of the budget to the store and have your child write down actual expenses.
Teach the concept of opportunity cost by telling the child that a more expensive item might mean sacrificing something else.
Talk with the child about ways to cut costs and stay within budget. Examples may include clipping coupons, taking advantage of sales, or buying supplies each semester.
Teach the child how to comparison shop to avoid impulse buying or paying for overpriced supplies or clothing.
Explain the difference between needs and wants. To fill the gap between a need and want, encourage the child to contribute their own money.
Offer a challenge. If the child comes in under budget, offer to split the savings between the two of you.
Set up an ongoing monthly budget to continue the money lesson throughout the school year.
Encourage kids who have savings and/or checking accounts to keep up-to-date records of all cash, card, or check deductions in their checkbook registers.
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