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Sorry kids, money doesn't grow on trees!

Talking to your kids about financial responsibility

The experts at RetailMeNot have released survey findings to showcase how financially responsible the nation is.

The survey found that 29 percent of consumers do not currently have any money set aside in savings.   

Among those that do have money saved, 71 percent (which is down from 80 percent last year) say they don’t believe their savings will last them very long. About a quarter of respondents (24 percent) lack enough savings to last them more than a month without additional income.

READ MORE: Does altruism produce happier kids?

There is a silver lining, however. Of consumers who have money saved, 30 percent estimate their savings would last them over three months without additional income. And men seem to be doing better than women in this category, as 75 percent of men report having savings compared to 68 percent of women. Millennials are savers as well. In fact, they out-save other age groups – 77 percent of Millennials (ages 18-34) have at least some savings set aside compared to 67 percent of those ages 50-59.

We all know kids are happy to spend money whenever they get it, but do they know where it comes from? Do they know the value of savings vs. spending? To help parents teach their children financial responsibility at any age, RetailMeNot’s senior lifestyle editor Trae Bodge puts together some best practices for every age. 

Ages 2-3
Start early! Kids at this age can be taught to differentiate between different coins and bills. This is a great way to help them develop their counting skills too. This is also an age where you can start discussing wants vs. needs.

READ MORE: Should parents pay kids for good grades?

Ages 4-6
You might be inclined to leave them at home when you have shopping to do, but shopping presents an excellent opportunity to demonstrate how transacting works. Also, set up a savings account in their name if you haven’t already done so. When they receive money as a gift, bring them to the bank and show them how depositing works and how their bank balance increases in the passbook.

Ages 7-9
This is a good age for giving allowance. If kids earn it by doing chores, they can see the cause and effect of their hard work. You can also give them control over this money so they can learn about saving vs. spending. Allow them to choose things they want at the store and conduct the transaction themselves. They will learn very quickly how to make smart purchasing decisions.

Ages 10-14
Set up a checking account with a debit card for your child so they can learn about balancing a checkbook. Now, when they receive financial gifts, work with them to decide how much goes into checking and how much goes into savings. They can use the money from the checking account to purchase things that are outside of what you have budgeted for (think pricey sneakers or a trendy purse).

If they have their own phone at this point, have them pay a portion of the bill themselves.

READ MORE: Tips for saving money with a new baby in the house

Ages 14-17
Put money in their checking account and let them shop for clothes and other necessities with that money – this works well prior to school starting or in preparation for summer.  This is a great way to teach budgeting and how to look for sales and coupons to make the most of their money. 

Ages 18+
It’s time for a credit card (with a low minimum) so you can explain how credit and interest work. If there’s a big ticket item that they want (but don’t need), they can purchase it on the card and pay it off. Also, talk about college – how much it will cost, how much is in their 529, how student loans work, etc.

Trae Bodge is the Senior Lifestyle Editor at RetailMeNot.