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I am a wife, mother, and step-mom. I am not perfect, but try my best to reduce damage control. I have incredible family and friends that encourage us on this adventure. My mom always told me that motherhood isnt for whimps... and I couldn't agree more!

Friday, March 2, 2012

Creating a Financial Team with your Child- Visual Budget

I did a bit of research and brain-storming to find ideas and resources to help my princess understand our financial boundaries and limitations and create a financial team.  I came up with the idea of creating a visual budget. This is a simple idea for children to understand the limitations of financial income and spending. (This actually really helped me visualize the money in actual places, rather than just numbers on a piece of paper.)

She was really excited about this activity! We practiced counting, adding and subtracting money. She saw what looked to be a lot of money- actually wasnt all that much after the bills were paid.

First, I used a standard budget form to get ideas of what expenses would be on a budget. I drew each one out in a picture for her to color. 

Once colored we glued them on to envelopes. I started with gluing one picture per envelope- but later found that I could seal the envelope shut, then cut it in half to create two envelopes from one. Frugal!
Next we glued them on to our board. (I used an old board we had around the house from when I was teaching her about eating all the food groups. We just tore off the old display and covered it in white paper again. But you can use paper... or even just find a blank wall to stick it to!)

We started at the Top with the Paycheck.

 Next to and under the paycheck we glued the more urgent and used financial categories (ie: Rent/Mortgage, Utilities, Car Payment/Insurance, etc)

 I found a PDF file online with kids cash to print out... So we printed some money and cut it up. WARNING:  This was exhausting and tedious without a paper cutter. If you dont have a paper cutter- try the dollar store for pretend cash... or maybe you have some old monopoly money laying around!

 The basics of it are easy. Using the play money, count out how much money was in your paycheck/bank account. That is all the money that you have to pay for bills needing to be paid. Then using the money in the PayCheck envelope, dispense the correct amount into the envelopes of the bills that need to be paid.

For example: If your paycheck was $800.00, count out $800.00 in bills. Insert that into the paycheck envelope and put the rest away.

Now, what bills need to be paid?
Electric: $50.00
Nanny: $250.00
Rent: $600.00
Groceries: $50.00

How much do you have left for eating out, new shoes, birthday gifts, and movies?

This really helped my princess see that we dont have an endless amount of money. There is no money tree that I am secretly growing in the backyard. So, when she asks me for McDonalds... and I answer no because we dont have the money for McDonalds, she now understands what that means.



1 comment:

  1. Omg I am SOOOOOOOOO doing this!!! Thanks!!