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4 Tips for Teaching Your Children About Frugal Living

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My dad is a master of frugality. His brother often remarks that it's "the family way." As a kid, I thought my dad was cheap, but as it turns out, he's just smart. He knows what's important to him and what isn't. Those priorities are reflected in the way he spends his money.

The car he had when I was in high school was the base model. It didn't even have a radio. When I would ask him why, he would say, "I don't need a radio in my car." When Dad would take me to a fast food restaurant (a fairly rare occasion), he was never willing to buy drinks. "Those drinks are so over-priced. We can get a drink at home," he would tell me. As a child, I didn't understand it. It drove me nuts. Now as an adult, I can see that where it drove me was down a path of financial success.

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As a mother, I've vowed to teach my children to be frugal too. My 14-year-old hasn't fully embraced the concept yet. She does enjoy seeing her money go further when she buys things that are on sale, but she's still fairly enamored with high dollar items. And I'm not always as good as my dad was when it comes to holding firm. I can't remember my dad ever giving in to those fast food sodas. Although I'm sure he must have at some point during my 18 years of childhood.

If you've also made a vow to teach your children to be frugal, here are four things you can do:

1. Have conversations with your children about money. Talking about money remains taboo in our society. People are more comfortable discussing the private topics of their workplace, health, and relationships than they are discussing their finances. Talk openly with your children about how you are and are not going to spend your money. Be willing to say "yes" or "no" -- and then explain why.

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2. Find a balance. I could tell you that you should never buy your kids expensive shoes or name brand clothes, but I'm not going to. I think as parents we can find a balance between providing a lifestyle that allows our children some flexibility in a world that puts such a high value on material things and providing a lifestyle that shows our children that frugality will ultimately be a roadmap for financial success.

3. Encourage your kids to be entrepreneurial. Children will learn the value of a dollar when they have to work for it. Kids can do a variety of jobs, appropriate for their age level, either inside or outside the home to earn money.

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4. Help your children get into the habit of saving. Set up the expectation that they save 20 percent of any money they earn or receive.

I expect, like it is with so many other lessons we try to teach our children when they're growing up, that it may not be until my daughter is out on her own that the light bulb will really go off in her head. I picture her being debt free, having a solid savings account, and investing for retirement and other future needs she'll have. I picture her standing in the midst of her firm financial foundation thinking to herself, "Wow, I guess Mom really did know what she was talking about when it came to all that frugal stuff. She taught me well." I don't think this is too much to hope for.

But for now, my sweet daughter just rolls her eyes when I drag her to the clearance section at the back of a store. I don't go shopping that often, but when I do, I always hit the clearance racks first. Maybe it's my version of a radio-less car or a soda-less trip to McDonald's. Dad taught me well. Teach your children well, too.

Clare K. Levison is a frugal-living contributor for account management service Manilla.com, the leading, free and secure service that lets you manage all of your bills and accounts in one place online and on mobile apps. Clare is also a certified public accountant and author of Frugal Isn't Cheap: Spend, Less, Save More, and Live Better. She is a national financial literacy spokesperson for the American Institute of Certified Public Accountants (AICPA) and has appeared on major radio and television networks across the country discussing various personal finance topics. She has served as a member of the Virginia Society of Certified Public Accountants (VSCPA) Board of Directors and was named one of the 2010 Top Five CPAs Under Thirty-Five by the VSCPA. Levison has more than a decade of corporate accounting experience and is also an active volunteer, serving as PTA president, Girl Scout leader, and Sunday school teacher. She lives in Blacksburg, Virginia with her husband and two daughters.

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