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7 Ways To Teach Your Spoiled Child About Money Management

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7 Ways To Teach Your Spoiled Child About Money Management

If you’re counting on the public school system to teach your children about money management, prepare to be disappointed. There is only one person with the power to turn your spoiled child into a fiscally responsible adult: you. Here are seven tips that might help.

1. Don’t tie allowance into every single chore—

Household chores should be done without expectation of payment. Tying your child’s allowance into the simple act of cleaning house is a sure-fire way to raise your child to become a messy adult with a home so disgusting that no one would ever want to visit. Instead, explain why a clean house is a nice thing to have. You could say something like:

“I know mopping floors and cleaning counters might not be exciting, but we need to clean up once a week, because it is easier to have fun and relax when there are less messes to worry about. Also, if we don’t take care of the kitchen, bugs could get to our food, and isn’t that gross? It would make me feel really good if you helped me take care of that.”

2. —but offer incentive for tackling challenging tasks.

While you shouldn’t bribe your kids to do chores (something they should do for no financial reward), you should offer incentive for tackling projects that require more time and initiative. You could set a flat-fee for more complicated tasks like mowing the yard, organizing the closet, and boxing up unneeded clothes and toys for a yard sale or charity drive. Feel free to take this a step farther by encouraging your child to open their own lemonade stand or yard-work business. You’d be smart to teach them how to market themselves at a young age, because a college degree doesn’t guarantee a good job in today’s economy.

3. Draw a diagram to illustrate your family’s priorities.

It’s difficult to explain fiscal responsibility to children in words that they will comprehend, so why not draw a diagram to illustrate fiscal responsibilities in a way they can understand? You don’t need to be a Michelangelo or Donatello; just draw an inverted triangle like this:

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inverted-triangle

    Then list your expenses in the order of their priority like so:

    • Shelter (rent/mortgage)
    • Food, clothes, and other groceries
    • Utilities (heat/air conditioning, electricity, water, phone, Internet)
    • Savings/Investments (emergency expenses like doctor visits, long-term investments like vacations to theme parks and beaches)
    • Charity/Giving (helping those who are less fortunate)
    • Wants (ice cream, toys, movie tickets, video games)

    While it’s okay to spend money on things your child would like to have, you need to make sure they understand the key difference between “needs” and “wants.” Using the inverted triangle as an illustration, explain that your family has an awful lot of needs that must be met before you’re able to consider your child’s individual wants. Repeat this lesson as often as necessary, because it’s vital for your child’s long-term financial success.

    4. Use three separate piggy banks: saving, giving, and spending.

    This tip is repeated often enough to be obvious, but it’s obvious because it works. Get three piggy banks (or anything else childlike that money can be stored in), label them as listed above, and set a percentage for each category like so:

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    • Saving = 50%
    • Giving = 20%
    • Spending = 30%

    I’m not suggesting you must use those percentage points listed above; see them as a general suggestion, not a strict guideline. Set them in your own way that fits your personal beliefs about how money should be spent, and/or what you feel would be most beneficial to your child.

    5. When appropriate, turn those piggy banks into interest-earning savings accounts.

    Children seem to learn better visually at a young age, so I’d recommend using the piggy bank approach until they are old enough to grasp the concept of “interest-earning savings accounts.” When you feel they’re ready, take them to the bank to open their first savings account. Make sure you explain why this is a good thing for them to do by saying something like:

    “I’m so happy and proud of you for saving (Insert Dollar Amount Here)! But now we’re going to put that money in a credit union, because they will pay you a little bit extra just for being smart enough to save your money.”

    Share a bank statement with them quarterly and make a big deal out of how well they are doing by pointing out how many dollars they made in dividend, and exclaim, “Wow! If you made that much with the x-dollars you put in there, I wonder how much you can make if you invested y-more-dollars every time you get paid your allowance?”

    6. A thoughtful gift is better than an expensive one.

    Have you ever really watched your child while they open presents during Christmas or their birthday? If they are ripping away wrapping so rapidly that they don’t even take a moment to react to each individual gift before moving on to the next one, you might have a spoiled child who doesn’t appreciate anything. If you don’t think thoughtful gifts are better than expensive ones, please recall a baby (yours or otherwise) who you’ve seen open an expensive toy, only to find the box it came in much more fun to play with than the toy itself. Materialistic stuff never made anybody happy, so stop buying your child every shiny, new thing under the sun, and start focusing on more frugal (but thoughtful) ways to express your love.

    7. Use grocery shopping to illustrate buying for value.

    Just in case you weren’t aware, there isn’t typically any difference between name-brand labels like Green Giant green beans and the generic variety offered by your grocery store. Use this opportunity to teach your children how to shop for value. Present them with two identical groceries—for example, an expensive name-brand jar of peanut butter and a more affordable generic variety—and ask them which one sounds like it would be a better deal. For bonus points, use this exercise while they are learning basic math, because they will find the subject more interesting (or at least less boring) when they understand how it applies to their life.

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    For a list of cheap and healthy foods, grocery savings tips, and a full-length shopping list you can print and take to the store or download to your phone, click here.

    It’s easy to end up with a spoiled child who doesn’t appreciate anything if you let them have everything they want. Follow these seven tips to raise your child in a positive way that helps them become a fiscally responsible adult.

    Are there any extra tips you would add to this list?

    Feel free to pass this article along to any parents you know who might be helped by it!

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    Daniel Wallen

    Daniel is a writer who focuses on blogging about happiness and motivation at Lifehack.

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    Last Updated on January 27, 2022

    5 Most Affordable Australian Cities For Students

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    5 Most Affordable Australian Cities For Students

    With high standards of education, a multicultural community, and laid-back lifestyle, it’s not hard to see why so many students love Australia. However, one thing Australia is also known for is being the world’s most expensive country to study in as a foreign student.

    For those willing to look beyond popular cities like Sydney or Melbourne, however, study abroad doesn’t have to be unaffordable. Check out these five more economical cities that still make for great student living.

    1. Gold Coast

    If you’re looking for a more affordable place to buckle down and study while still enjoying glorious beaches and a vibrant nightlife, the Gold Coast is an excellent choice. While it has no shortage of restaurants, cafes, bars, and natural attractions, the city is also well-known for its quality of education.

    Gold Coast is home to Bond University, which has Australia’s highest rating for overall graduate satisfaction, but also some of the country’s highest tuition fees. Fortunately, it hosts campuses for Griffith University and South Cross University as well, both of which have affordable options for international students.

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    When it comes to off-campus accommodation, there are plenty of choices, from shared housing to homestays. Real estate sites like Flatmates can be useful for finding options within your budget.

    2. Wollongong

    Wollongong’s close proximity to Sydney (80 km) makes it a popular choice for students who can’t afford the high cost of living in Australia’s largest city, but still want to experience all that it has to offer. Wollongong itself is a lively city as well, and is rated as the country’s most livable small city thanks to its gorgeous beaches and lively city centre.

    The University of Wollongong is one of Australia’s top universities, with a comprehensive academic program, international research reputation, and high graduate employment rates.

    Due to a lack of on-campus parking, most students prefer to walk, cycle, or use the free bus service that operates between the university and city centre. Living costs are quite reasonable in Wollongong, and sites like Gumtree can come in handy if you’re looking to split housing costs or even score some second-hand furniture on arrival.

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    3. Hobart

    Hobart is the capital of Tasmania, the second oldest city in Australia, and also the cheapest city for university students to live in. While it might not be as happening as cities like Gold Coast or Brisbane, its striking natural beauty and slower pace of life make it a great place to block out distractions and focus on studying.

    The Hobart Universities sector is based on a single institution, the University of Tasmania, which is consistently rated among the top ten universities in Australia and has a large population of students from abroad, with more than one in five students being international.

    Although public transport in Hobart isn’t as convenient as could be, there is plenty of student accommodation available to make up for it. Students often live in shared houses near the university so they can simply walk to class. If you’re looking to rent a shared house or room in the area, Easy Roommate can be a good place to start your search.

    4. Adelaide

    Of Australia’s major cities, Adelaide is the cheapest to live in. That, along with its spacious layout, clean and green atmosphere, and beachside attractions make it a great place to live and study. It’s also regarded as the food and wine capital of Australia.

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    Adelaide has three universities, including the University of Adelaide, which is ranked in the top 1% of universities worldwide; the University of South Australia; and Flinders University. Its integrated bus, train, and tram transportation system connect all parts of the city and make it easy for students to get around.

    Naturally, the cost of accommodation is lower outside the city centre, and depending on which university you’re studying with, the outer suburbs could be more convenient as well. Check Study Adelaide for information on a range of student accommodation options, from independent living to homestays.

    5.  Brisbane

    Brisbane is the capital of Queensland and Australia’s third largest city. Unlike Sydney and Melbourne, it’s known for being one of the most affordable cities in Australia, which makes it a good choice for students. It’s also known for its pleasant subtropical climate and wide range of entertainment options.

    Brisbane has three major universities: the Queensland University of Technology, the University of Queensland, and Griffith University (which accepts the most study abroad undergraduates). The inner city is well-connected by public transportation, although cycling is popular as well, and there are plenty of cycle paths that make it easy for students to get around this way.

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    Students typically live in and around the inner suburbs, where the bulk of Brisbane’s teaching facilities are located. If you’re looking for convenient accommodation off-campus, you can check sites like Urbanest or The Pad.

    Featured photo credit: Bhavesh Patel via unsplash.com

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