This article is part of a series on Teaching Kids About Money.
Let’s be honest, most people don’t donate as often as they should. I’m guilty of it myself. But donating to good causes does play in the realm of being financially responsible as a society. And this is something that needs to be introduced to our younger generation at an early age as well. Teaching kids to donate part of their money isn’t only helpful for society, but it’s also very beneficial for them.
- Sharing is caring. I would hope that a majority of the people out there want to make sure their children grow up caring about others. It is suggested that ten percent (10%) of your revenue should be set aside for donations to charities. What does this teach your kid about money? Well, simply that a majority (if not all) of the time there will be people less fortunate than themselves and they should help whenever possible. From a value of money perspective, it helps strengthen their idea how important money is in society.
- Power in numbers. It’s true that a single dollar won’t exactly feed an entire nation alone. It’s really the idea that we, as a society, can help others. This then teaches our younger generation that when multiple people come together to help others, then making a positive difference can be achieved.
- Introduction to tax deductions. Taxes are inevitable, and too many Americans are still left in a dumbfounded state when this topic is brought up, which we need to hedge. One way to hedge that is to introduce how donations are tax deductible. It’s a bit of hard concept to understand, especially for a child. How does giving money give me money back? It’s a bit counter intuitive, but it can be a good introduction to a kind of investment as well. Please note that this may be something you’ll want to teach them only after you teach them how to save and instill the value of money to them.
I know this particular article is only loosely related to the idea of teaching kids about money, but I really felt it was something that needs addressing. Being financially responsible doesn’t simply mean saving for ourselves, but doing what we can to help others whenever possible.
What percentage of your revenue do you think you donate?