Disclosure: This post is sponsored by T. Rowe Price and Scholastic. All opinions are my own.
Summer and vacations tend to go hand-in-hand. The kids are off school, the weather is lovely, and we’ve all worked hard, so it seems an ideal time to spend on vacation. Families often have different ideas and budgets for vacations from staycations or daytrips to spending the summer away from home, but whether you’re traveling to the beach for a week, camping out, having a staycation at home, or going on an overseas trip you can use this family time to teach your kids some incredibly valuable lessons about money.
It seems a little at odds with what a summer vacation is supposed to be, right? You’re meant to be relaxing, hanging out as a family, and not worrying about the finances. But, all parents know that you’re never truly off-duty, and by using this downtime to talk money may not be high on your list of relaxing family activities it can be incredibly valuable.
T. Rowe Price conducts a yearly survey of families to find out what parents want to teach their kids about finances and managing money and what they truly are doing. We all know that kids learn by watching us, and while we may have lofty goals about setting our kids up for financial success we’re often at odds with those goals by how we choose to spend and save (or not).
Their survey in 2016, called officially the T. Rowe Price’s 2016 Parents, Kids & Money Survey, revealed a lot of interesting statistics, and many will provide you with insight into not only what you can do to better teach your kids about money, but also how you can use your summer plans as a way to show your kids smart money management skills.
How to use a summer vacation to teach your kids about money:
Talk budget: To start you can talk about how you save for family vacations and be real with them about the budget. Give them dollar amounts to make it real for them. If you have younger kids talk about your budget for specific things-say choosing between a visit to two local attractions.
Get them involved in budgeting: 71% of parents have at least some reluctance to discuss financial matters with their kids, but they won’t learn unless we teach them! Talk actual dollars and cents with your kids. My kids have always contributed to family vacations in one-way or another. Talk about choosing between hotels or choosing which places to visit during your vacation. Kids are great at using the internet, so put them to work finding free events, museums with discounted days, or stuff to do on vacation. Yes, this even works on for a staycation-have them make a list of things they want to do with you!
Actually save: The survey revealed that 17% of parents used their retirement savings for vacations. Guys, just no. Yes, memories and travel are important, but no one is going to bail you out come retirement time. Show kids how you save by either using a family vacation jar or charting your savings and putting it front and center on your family’s command center or fridge.
Get kids to save, too: This statistic from the survey is surprising: 46% of parents have gone into debt for something their kids wanted. Don’t put yourself in a bad financial position for your kids instead encourage them to save. We don’t consider family vacations something the bank of Mom & Dad covers. We ask the kids to pitch in by saving their money for their own splurges (while we cover the big expenses). When they were smaller they loved using a giant water jug to help us save for our first ever family vacation-a trip to Walt Disney World.
Guide kids on spending: Listen, we all want that first thing we see when we’re on vacation, but encourage kids to think through their purchases. At home we use a one-day waiting period, and you can do that on vacation, too. If there isn’t time to return to the same place set it aside until it’s time to leave and discuss why they want it and some other stops you make that may have other souvenirs to purchase.
Show kids how to splurge smart: While you’re saving up for your vacation they may want to do 101 other things that cost money. Talk about those decisions-if we go to the amusement park this weekend that could cost $350, but if we instead stay home and visit the local parks we could throw that into our vacation fund. It helps put saving in their hands and encourages them to make smart choices.
Teach kids to prioritize experiences: Teaching kids to value the experience and be in the moment is tough, so find ways to help them do that (and help yourself do the same) by taking full advantage of your vacation. Instead of hitting the seaside shops go seashell hunting or instead of hunting for souvenirs in the gift shop spend that last 15 minutes of your museum visit going back to your favorite exhibit.
All these ideas are a place to start talking to your kids about money and saving, but they will open doors to discuss all kinds of other financial matters with your kids beyond just your vacation budget. You can use them to talk about summer camps, supplies for your trip, and more. Most importantly you will give them skills that will help last them a lifetime.
You can find out more about the study and get all kinds of great advice from T. Rowe Price’s Money Confident Kids website. Click here to read more.
This is a sponsored conversation written by me on behalf of T. Rowe Price. The opinions and text are all mine.