Topic 8: Budgeting

Teaching Budgeting

You begin teaching budgeting when your kids are very little. Maybe they get some money for their birthday or for doing their weekly jobs around the family home. As a parent you then have the opportunity to teach them about budgeting by discussing with them how they will allocate that money. You would most likely suggest that they spend some, save some and give some to a charity.

Your job will be to explain the reasons why they might allocate money to each of the three areas, and then ask them to decide how they will allocate their money.

Money boxes that have the three compartments are available, but you can also be budget conscious and use three empty Vegemite jars, jam jars or similar. These will cost you nothing, and because they are usually made of clear glass your kids will see their savings growing. Use an ink pen to write the three purposes on the jars.

As they get older you would open bank accounts to replace the jam jars and begin to teach them about Flow and automating the transfer of money according to their chosen distributions across accounts (chapter 3).

Teaching Spending Planning

By the time your kids are in their teens and in high school, you would show them how to set up their own Spending Plan. This would allow them to create a plan for schoolbooks, uniforms, Christmas shopping, maybe purchasing their first car and whatever else seems appropriate for your kids at that time. It should also allow them to have some money for them to do with as they like as a result of that planning.

Go to to find out how you go about getting access to the Spending Planner application and setting up your own Spending Plan.


Value for Money

How many different prices are there for the same product?

Have your kids look for all the places they could buy ice creams, drinks, meals, etc. Get them to record the different prices and locations and have them identify which purchase option and which retailer offers the best value for money.

If they were purchasing with their own pocket money, which supplier would they choose on a hot day?

Make this a regular exercise with other products, e.g. takeaway food vs food prepared at home and taken on an outing or to weekend sporting fixtures.

Offer them the difference in cost to keep as cash if they are prepared to plan ahead and take food and drinks from home on the next outing rather than buying from take away outlets. Of course, they will need to check the prices at those take away outlets.

By the time they reach adulthood your kids should know:

  • That a budget is a starting point that will help them to begin the journey towards taking control of their money.
  • That a Spending Plan will empower them to look forward with their money planning to avoid embarrassing cash shortages at crucial times 
  • That a Spending Plan will allow them to make the most efficient use of every dollar they earn
  • How to create and follow a Spending Plan
  • How much family expenses such as food, fuel, electricity, phone, rates, insurance, car registration and other basic family expenses cost   ·  
  • How important it is to plan ahead for major expenses, e.g. when buying a car, looking beyond the initial purchase price to the cost of ownership such as vehicle registration, tyre replacement, servicing, insurance, etc.

Lower Primary School Years:


Upper Primary School Years:


Lower High School Years:


Upper High School Years:


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