Our new, in-app Money Missions are designed to accelerate your child’s financial education, and help us achieve our mission to make every kid smart with money. Now, when they log into their GoHenry app, kids can watch fun, animated videos, take quizzes and earn points and badges. You can use your GoHenry parent app to track your child’s progress; when each lesson comes to a close, another one begins, and your child will unlock new levels as they progress.
Budgets & plans is the seventh Money Missions topic. If you’ve struggled with teaching budgeting to children, or your child has a habit of spending all their pocket money on the day they receive it, money lesson plans can help to make their allowance go further.
As well as setting aside money for saving and giving, teaching teens to budget will also mean they’re less likely to run out of money – which means they can afford exciting last-minute outings like cinema trips with friends. Read on to find out the best way to explain the benefits of budgeting to your child.
What is a personal budget?
A budget is a plan we make for how to spend or save money. This could be a regular weekly, fortnightly or monthly plan, or a one-off budget for a special event or occasion, such as a holiday, a party, or Christmas shopping. We can also use a budget to help us achieve our savings goals.
Budgets help us to make sure that we have enough money for our needs and wants, and won’t run out of money unexpectedly. Adults have to pay for lots more things than children, such as a place to live, household bills and food to eat. So it’s a good idea for children to learn how to budget, because we only have so much money – and once it’s gone, it’s gone!
How to teach kids to budget money
When we’re making a budget, the first thing to think about is how much money we have coming in, during the week or month. This is called our ‘income’.
The next step is to work out how much of that money we plan to spend, also known as our ‘outgoings’. Once these essentials have all been covered, we can then decide how much of what’s left of our income we plan to save, or give to charity.
When budgeting, it’s important to keep track of what we spend, so that we don’t run out of money. Remember, our outgoings should never be more than our income – and if we overspend on something that means we’ll need to cut back on something else.
A budget is a plan, and our plans can always change. Some weeks or months we might have a little more money than others, which means we can afford to spend or save more than usual. But other times we might need to cut back on spending, especially if an unexpected expense – like a trip out with friends or a birthday celebration – has used up some of our money.
Want to teach your kids all about earning, saving, and budgeting money?
Create a GoHenry account today and gain unlimited access to our new, in-app Money Missions. These feature fun videos and quizzes, designed to teach kids about finances and build crucial money skills from an early age.