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Monday, January 6, 2014

Financial Management: Creating a Family Game to Prevent Debt

Have you ever thought about making your household finances a game for the whole family to play? With so many board games that utilize money to win the game, children will have the basic concept that winners have the most money in the end. Besides creating a way to keep monthly costs down it promotes family time and builds a financial understanding for money management. Who wants to teach a child that using other people's money is best? A little practice on self-sufficiency will go a long way and prevent a fast cash advance from entering the picture. .

Depending on the age of your children, you will want to include as much detailed information as you can.
*It is important to begin the game with an understanding of income and a budget. It's always good for kids to understand that money comes from somewhere. Too many children only see plastic cards as a source of payment. Take a few minutes and explain what credit or cash advance loans means and how it can hurt you if you don't have the money to pay it back.
*Define needs and wants and see what the children can come up with to place in each category. They need to start understanding each category in order to play the game.
*Talk about utility payments mortgages, car loans, insurances groceries and fuel. Use an average
payment and subtract from the total
*Use old receipts to show food and
fuel costs so they can see how
controlling these two can make a
difference in what is left over for other household needs and wants.
*Ask for suggestions on how to handle unexpected costs like the mechanic or trip to the doctor. Discuss how these costs are often handled by credit cards or direct cash loans especially when there is limited money to cover everything else that month.
Create a game out of saving money. Trips to the grocery store when kids find needed items on sale or keep their bedroom lights shut off whenever they are not needed are great opportunities to earn 'game cash'. Your child ran outside to play without turning the television off would end up as a forfeit of cash. Children will begin to internalize routine behaviors for the benefit of the household budget. Bonus shillings for children who make it through the trip to the store without asking for extras are a great way to nip certain behaviors in the bud. It could also promote brown bag lunches or snacks rather than cries to stop to buy something outside. At the end of the week the person with the most 'game cash' could win a small treat. As a family, go over what was saved by the end of the month and celebrate together.
Games are a great way to provide incentives to improve. Once the saving money behaviors become habit, your budget will be better for it. Talk about money as much as you can in child friendly terms. True life money management lessons are a great way to set your child up for life. Free them of ever feeling the need to apply for cash loans or max out their credit cards in order to pay the bills. Personal finances are about finding freedom that you can afford with the money you earn.

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