Teaching Money Management to Kids on Vacation

Lisa Fritscher November 10, 2014 No Comments


If your child is creative, selling handcrafted items can raise some spending money.

A vacation is a time to kick back and enjoy some family fun, but it is also packed with teachable moments that are easy to implement. One of the biggest teaching opportunities on any vacation is money management. Unless you happen to be independently wealthy, every phase of your trip is filled with budgetary considerations. Involving your kids in an age-appropriate way provides vital lessons for the future.

The planning phase of the trip is arguably the most important financially. Where will you go, and for how long? How will you get there? Where will you stay? What about eating? Will you sign up for special tours and extra experiences? Although numerous factors go into answering these questions, there is no doubt that the budget plays a large role.

How to involve your kids depends on their ages and developmental levels. For toddlers, talk about your plans as you make them, and try to break complex topics into simpler categories they can understand. For example, you might talk about how you can go to the hotel pool as many times as you want, but the water park will cost as much money as 5 trips to your favorite fast food restaurant, so you can only go there once.

Elementary school aged children are old enough to get involved in basic decisions. For example, you might give a child this age an entertainment budget and have her look at your destination’s tourism website. Have her make a list of experiences that fit the budget, and then sit down as a family to choose the ones you will schedule.

By the time kids are in middle school, most are ready to take on some of the basic planning duties. If you want to go on a cruise, have your 12-year-old research the best prices online. Calculating gas costs for a road trip, choosing a hotel based on price and reviews, and finding coupons for restaurant meals are all well within the capabilities of most middle and high school kids.

Spending Money

Kids are never too young to start learning how to budget discretionary funds.
credit: Junior Libby

Kids are never too young to start learning how to budget discretionary funds. If your child gets an allowance, encourage him to start saving for the trip as soon as you decide to go. If not, find ways for your child to make money, such as doing chores around the house. Also consider giving cash for any birthdays or special events that fall before your vacation.

Shortly before your trip, add any additional spending cash that you want to give your child. Then have an age-appropriate talk about what the child’s spending money should cover. Obviously, you will provide the basics including meals. What about extra snacks, such as a box of popcorn or a bag of candy that only the child wants? Are you planning to buy souvenirs for everyone? Be very clear about what you plan to pay for on the vacation, so your child knows what to expect.

While on the trip, avoid the urge to tell your child “no” about anything that is not illegal or obviously age-inappropriate. If he has the available money, let him buy a stuffed animal or waste a couple of hours in the arcade. On the other hand, stand firm on what you told your child before the trip. If you told her that she was responsible for her own junk food, don’t add her ice cream cone to your bottled water purchase. As long as you provide the hotel room, regular meals and admissions, running out of spending money early in the trip can be a valuable lesson in the importance of moderation.

During the Trip
Of course, some of the best vacation moments are unplanned and unpredictable. Yet most of us still need to take a quick look at our funds before adding something major mid-trip. If you hear about a great restaurant, special show or other pricey opportunity, involve your child in the consideration. Give him an estimate of how much remains in the vacation budget and ask him whether he thinks the new opportunity is a wise choice. If the price is higher than you are comfortable with, give your child a chance to problem-solve. Can he find spots in the remaining vacation schedule to cut back?

Older kids, typically upper elementary and beyond, can learn to make value judgments based on subjective criteria, so give them a chance to practice. Is the new opportunity worth more than an upcoming meal or special event? Is it better to spend the money all in one shot, for two hours’ entertainment, or to spread it over two days of less-expensive experiences? You don’t necessarily need to turn the final decision over to your child, but give her time to think through all the pros and cons.

Back at Home
When you get home, review the trip as a family. Talk about your projected budget and how much you actually spent. Pay close attention to the cheapest and most expensive things you did. Discuss the high-priced events and decide as a family whether they were worth the money. Add up everything you paid $5 or less for, and compare the total to the individual prices of more expensive experiences. This helps your child see how seemingly meaningless purchases add up, providing an awareness that will stay with him for a lifetime. Keep the conversation upbeat, positive and reasonably short, staying focused on a logical, unemotional assessment that concludes with ideas for the future.

avatarAbout the Author:

Lisa is a full-time travel writer. She lives in an RV with her disabled father and writes about their experiences. Although she has no children of her own, Lisa loves being an Aunt to her own relatives and the children of all her friends. You can follow her adventures on her blog, Travel Confessions.

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