As we move through the holiday season, your parents may be telling you to think about what you want versus what you really need. It can be very confusing to understand how your family spends its money. To determine how to spend money, your parents may have set up a family budget.
Ask them to tell you about the budget, and show you how they allocate their income. They may talk about paying for utilities and other necessities and then how they determine what they have to spend on things that the family wants. Then think about how you can use that information to set up your own budget with sections for what you earn and what you want to spend and what you might save, invest or donate. If you don’t have enough money to pay for all the things that you want or want to do, think about how you can earn the money.
Parents: A good way to answer children’s questions about how the family budget is determined is to explain where the money goes. Read How Can I Keep My Money from Slipping Away? to learn more.
