During today’s challenging economic times you may be struggling to keep your head above water. And looking back on the financial mistakes you’ve made, you wonder if you’d be on better financial footing if your parents had done a better job teaching you about money.

To help your own kids learn how to handle money responsibly and to help them avoid the financial pitfalls you’ve made, you may want to start laying a foundation early on:

1. Begin with an allowance.
   Give your kids a weekly allowance in return for doing household chores so they get a firsthand idea of the value of money: having it, spending it, and saving it.

   Let them know that whatever allowance money they earn is theirs to spend as they please, but be sure to emphasize the fact that just because there’s money in their “piggy bank,” it doesn’t mean they have to spend it. Managing a small amount of money as a child may go a long way in establishing healthy financial habits as an adult.

2. Have them get a part-time job.
   Suggest that your kids get a part-time job once they’re of working age. A part-time job can be a real character builder and it can help teach your children the value of money and all that comes with earning it, including paying federal and state taxes.
3. Teach them about the benefit of savings.
   Advise your kids to start setting aside a significant portion of their allowance or what they earn from their job as savings. Point out that the more they save, the quicker and easier it will be for them to get that new iPod, Xbox game, or car they’ve been wanting.

   Take them to the bank to set up an interest-bearing savings account when they’re ready. Encourage them to make regular deposits and be sure to explain how their savings can grow significantly over time as their bank pays them monthly interest.

4. Ask them to contribute.
   Require that your kids start pitching in toward their own personal expenses once they get a part-time job. Ask them to pay for all or a portion of their cell-phone bill or of driving costs on the family vehicle they use, which can include gas, insurance, or the car payment.

   This extra financial responsibility will help them learn how to budget since they’ll have to set money aside for these individual expenses, a skill that will come in handy when they’re in college and on their own.

5. Tell them the truth about credit cards.
   Teach your kids about credit cards before they’re bombarded by all kinds of credit offers at college. Stress that credit cards should only be used in emergencies and encourage them to use a debit card tied to their checking account to cover monthly expenses.

Warn them about the dangers of racking up monthly charges on their credit card, including interest and other fees that may take them years to pay off if they’re making only minimum payments.

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