BACK-TO-SCHOOL BUDGETING REFRESHER

It's back-to-school time again and that always means it's also “back-to-spending” time.  This season people are projected to spend nearly $670.  This is a great time to teach your children.  Let's get back-to-basics.  Start by helping them make a spending budget for the two major back-to-school categories of supplies and clothing.

Begin with supplies.  First get a list of all the recommended supplies your children will need for the school year.  “Need” is the important word to focus on.  Give each child a small notebook and show them how to list each item and price.  Ask what supplies they think they will need or want for this year.  Again, they should write down the item and its price.  I recommend that you should pay for all the “needs” and have them pay for their “wants”.

Next, do the same thing with their clothing budget.  The list should be specific, detailing how many of each item they think they will need.  The total cost is likely to surprise you and your child alike.  After getting the totals, you decide the final amounts and prices.  If they say that the “need” three pairs of popular boots at $200 each, you get to say “I'll pay for $40 boots”.  We know this isn't going to be easy but this is a worthwhile lesson.

Your children can now start to understand the dynamics of planning, and most importantly, budgeting.