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The Cost of Living - "Check" it Out

Where to start…

While parents often say that their kids think money grows on trees, parents often don't sit down with their kids to show them what it takes "to live." If your family is like most, the kids don't think much about gas, electric, and phone bills. They're even less likely to think about mortgages, taxes, health insurance or auto loans. However, they may be aware of more obvious costs, like paying for music lessons and groceries.

While some adults don't want kids to know the amount of the family mortgage payment, kids can learn about the cost of living by looking at lots of other bills. It's a slice of real life that will help teens and tweens appreciate where the money goes. It also prepares them for life after the teen years. Kids whose parents teach them about money grow up to be better savers – putting them on the road to financial security.

Here's an eye-opening activity for the whole family. Everyone sits down at the kitchen table with the monthly bills, and the adults start paying them. As the parent introduces each bill, Mom or Dad should comment on it. Here are some points to discuss.  

  • How some bills stay the same while others go up and down.
  • That some bills come everyone month; some come quarterly.
  • How some bills come unexpectedly – like the plumber's bill when the pipes burst – but you have to have the money on hand to pay them. That's why everyone needs a cushion fund!
  • What happens if you don't pay your bills on time.
  • How credit card accounts rise and fall from month to month, depending on how much you spend. (Just taking a credit card bill and looking at all the items on it and how they add up to a large bill is a great activity all by itself.)

If you really want to make your point, bring piles of cash to the table, and stack the currency on top of each bill you pay. When you're done, the family should use a calculator to total all the payments – cash or checks. Then add in the cost of a month's groceries. Let that total sink in. Then explain that you pay many of these same bills over and over every month.