Posted On: August 24, 2018 by Peoples Bank in: Family Friendly General Kids Friendly Saving Money Savings
Warm, sunny weather calls for a glass of ice cold lemonade. Now that the kids are out of school and looking for activities to entertain them, now is the perfect chance to teach them a little about finances. Here are a few quick tips to help teach your children how to be fiscally responsible.
Have them buy the materials.
When deciding to have a lemonade stand, it is important that your children know the value of money. By having them calculate the cost of the lemonade, sugar, cups, sign, sunscreen and pitcher, they will begin to understand the importance of the dollar. You may help them out with costs if they haven’t begun to save from chores, but teach them with our next tip that money isn’t just handed to them.
They can ask you to lend or invest.
If your child is looking for a little cash to start up their business, feel free to teach them about lending and investing. Show that mommy or daddy can lend you $10.00 for ingredients. When you make $20.00, you owe them $10.00 and get to keep the rest - no matter how much you make! Mommy could also invest in your stand with $10.00. If you make $30.00, Mommy gets half and makes a $5.00 profit. However, if you make $16.00, then mommy gets $8.00 and loses money.
Show them how to take inventory.
Teach your child how to track their items and what each ingredient costs. They will be able to see how much each cup of lemonade costs and the profit they make from selling. They can learn about accounting by subtracting their total expenses from their sales to see the profit they accumulated. Remember to send an email or call the neighborhood before the launch of the stand, so your child can feel like a success. Helping them accrue a little extra business will excite them for their next business venture.
Review the sales.
Going over how well you did and what can be changed for next time is a great way to learn about business. Cover a few positives your children did well, and then hit on one or two improvements that could be made.
Let them decide where the proceeds go.
Giving your children the opportunity to choose where their money goes is a great way to allow them the feeling of independence. They can decide to give it to a children’s hospital, pet shelter or into their own savings account. If they choose to save, then you have the opportunity to segue into different approaches to saving!
A lemonade stand is a perfect way for your child to learn about money without boring them. Creating a lawn mowing business or other summer activities can also be an option if lemonade stands aren’t exciting to them. Give us a call to discuss different savings options for your children and their lemonade money!