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How to Use Back-to-School Shopping to Teach Your Kids About Money

Aug 17, 2021 3 min read Kate Ashford

Key takeaways

  • Your kids are invested in back-to-school shopping.
  • Make a game out of it to show them how far a dollar stretches.
  • Put them in charge — and let them make mistakes.


Pencils, notebooks and…budgets? Back-to-school time provides a great opportunity to teach your kids some important money lessons — and show them some budgeting tools — that they’re unlikely to learn in a classroom (even if that classroom is your dining room).


For fall 2021 the average family plans to spend nearly $850 on electronics, clothes and other K-12 school needs, according to the National Retail Federation. Even so, with COVID-19-related school reopening plans all over the map (and seemingly changing by the day), it can be hard to get a handle on your likely expenses.

Even so, many kids are invested in back-to-school shopping, whether it’s little ones excited about shiny new binders or teenagers hoping to snag some new shoes. That interest makes it easier for you to sneak some money education in and teach them how to stick to a budget. You can even make a game of it. Here are a few ideas.


List needs vs. wants

Being able to differentiate between what you must buy and what you’d like to buy is a valuable life skill, and one that even small children can grasp. Use index cards to list things your child might buy during back-to-school shopping, then have your child pin or tape them to a labeled bulletin board or poster board, under Want or Need. That binder required by the teacher? That’s a Need. The sneakers that light up when she walks? Those are a Want. Offer a prize or small amount of money for each item in the right place, and discuss how you might divvy up your back-to-school budget across the list. (Hint: The Needs should come first.)


Hold a “Price Is Right” competition

Before going shopping (online or off), have your children look at a written supply list, with both wants and needs, for the upcoming school year, then have them guess how much it’s all going to cost. To drive the point home, make a list with two columns — the estimated cost and the actual price. The child who gets closest to the final actual total without going over, as per the “Price Is Right” game show, wins an extra back-to-school prize.


Put your kids in charge

Consider handing your back-to-school cash over to your kids and offer them some incentive to stick to the budget (under your shopping supervision, if necessary). First, tell them that’s all the cash they’re getting. Second, if they manage to buy everything they need for less than what you’ve given them, they get to keep the difference.

Smaller children may need more guidance during the picking and choosing than older kids. Let them check out themselves and hand over the money for their items. There’s nothing like parting with their own dollars to teach kids to seek out the best deals. And when they see what a big bite an expensive item will take out of their balance, they might seek out cheaper alternatives. Within reason, resist the urge to bail them out if they make poor decisions — living with bad spending choices is one of the best ways to learn how to be responsible with money.


Double up on savings

Have your kids compete to see who can save the most money on the written school supply list. Encourage them to use coupons (even electronically), search for store specials and shop for store-brand products where it makes sense. Offer to contribute a dollar to their savings accounts (or piggy banks) for every dollar they can shave off the budget you’ve set. If a little healthy competition helps, offer an additional prize or privilege to the child who saves the most.


If they can earn it, match it

If your kids are the right age, offer enough money to buy only the back-to-school basics; for anything beyond that, your children must pay the difference. How might they afford this? Many children have used items that could be sold or clothes that could go to consignment shops. You might think twice about having them sell lemonade or baked goods in the age of COVID, but young kids can work as mother’s helpers or peddle old toys in a yard sale. And while babysitting may be a harder sell these days, outdoor jobs like lawn mowing or car washing could work well.

Post a chart with a revenue goal in a visible place, and help your kids track their progress with pins or colored blocks that represent chunks of savings. Offer to match any cash they raise in a ratio that makes sense: dollar for dollar, for instance, or 50% of what they earn. Consider offering a bonus if they reach a money milestone — an extra $20 for every $100 raised, for instance. Spending their own earnings is a great way for children to become invested in the process.



What you can do next

Whatever you do, don’t let this important time of year pass without making a money connection with your kids. It’s one of the few times when purchases are necessary (not optional) and your kids have some skin in the game. The more you involve them in spending decisions, the more they’ll learn about money management in general. When they’re ready, you can go further and teach them how to earn money as well.


Kate Ashford is a freelance journalist who writes about personal finance, work and consumer trends. She has written for BBC, Forbes, LearnVest, Money, Real Simple and Parents, among others.


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