Handling money is an important part of life. Feelings about money are first influenced by your parents and the other adults around you. People spend money on many different things.
Where do you spend money? What you spend money on depends on your values. Values are feelings about what is important to you. They help you to decide on your goals. Goals are things you want to achieve. Setting goals can help you get things you want to buy.
Values and goals change as you get older. When you were younger, your goal may have been to buy a new pair of jeans. Today, your goal may be to have a certain brand of jeans.
Setting goals is a way of "making plans" for your future. To reach your goals, you first must decide what you will need and want.
List three things you need:
List three things you want:
What is different between the two? A "want" is something you would like to have, such as a 10-speed bike, a new camera or roller blades. A "need" is something that is necessary, like food, clothing or shelter.
Are the things you listed as a need really necessary? Give your reasons:
Can you think of a case where a want could become a need?
Sometimes wants DO become needs. If you live out of town and play on a ball team, a bicycle could be a need. A pair of good basketball shoes for those participating in basketball games could also become a need.
To be good money managers you must meet your needs before your wants. What would happen to you if your parents didn't buy bread and milk, only candy bars and soda pop?
Choose something you want to have more than anything else. I want ________________. It will cost me __________.
Plan how you will get the money to buy it. Have all your needs been met?
In our society, money is earned and exchanged for the majority of goods and services we need and want. Money decisions make a big difference in our lives.
Children are not born with "money sense." Money management skills must be learned. Whether you realize it or not, children's attitudes and values about money are highly influenced by what they see and hear at home. The ways parents insure themselves, discuss money, spend, borrow, save, share and invest will affect a child's value system concerning money.
Preteens begin to realize that money itself has no value, but that it is needed to buy things they want. Fifth graders are "collectors." They want to save for specific things, usually one thing at a time. With continued practice your fifth grader will be able to save for bigger goals in the near future.
But how do you nurture that process at home? Being a good role model.
Effective money management is based on a realistic evaluation of individual and family needs, wants, values, goals and resources.
A "need" is something that is necessary like food, clothing or shelter. A "want" is something you would like to have.
Do you catch yourself saying "But I need that new magazine." Do you need or want it? To be effective money managers you must meet your needs before satisfying your wants.
Go through the activity on the front page with your child. Keep these points in mind:
For more information, the following publications are available at your county office of the NDSU Extension Service:
HE-274, "What to Do When Your Income Drops"
HE-440, "How Much Should We Spend?"
Brought to you by the NDSU Extension Service and your local county extension office.
See your extension agent for more money management information and other family economics programs.
NDSU Extension Service, North Dakota State University of Agriculture and Applied Science, and U.S. Department of Agriculture cooperating. Sharon D. Anderson, Director, Fargo, North Dakota. Distributed in furtherance of the Acts of Congress of May 8 and June 30, 1914. We offer our programs and facilities to all persons regardless of race, color, national origin, religion, sex, disability, age, Vietnam era veterans status, or sexual orientation; and are an equal opportunity employer.
This publication will be made available in alternative format upon request (701) 231-7881.
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