How I started using a budget at 13

Share this post!

One summer around my first year of high school, my mom told my sister and I we were going on a trip to Winnipeg.  She was attending a symposium of the Canadian Association for Family Enterprise and decided to take us along.  As you can expect, as kids, we were less than thrilled to loose a week of our summer vacation to go to a symposium in Winnipeg, of all places! We were told there were activities for kids as well, so we went.

I won’t get into the details of our week in Winnipeg, although we did meet a lot of great kids from all around the country and got to visit a lot of interesting places like The Forks and learn about the history of the area.  One of the sessions we attended was about the importance of teaching kids the value of money and budgeting.  In this post, I’ll explain how we took what we learnt and applied it in our lives (and still use the same technique many years later!).


As a parent, you spend a lot of money on your children, but you are in charge of budgeting what the money is spent on, whether it is on after-school activities, clothes or going to the movies.  The children assume there will be money for the things they need and want, but too often they have no idea how much these things cost or how hard it is to get the money they are spending.  The concepts that my mom learnt while in Winnipeg (let’s be honest, a lot of this stuff was way over my head at that age!), focused on transferring the responsibility of dealing with money to the kids to allow them to learn the value of money and how to handle money in a more controlled environment, before they are out living on their own, often making costlier mistakes with credit cards and mortgages.

The concept was simple, at the beginning of the year, my mom would sit down with each of us and make a budget for money that would be spent on us over the course of the year, breaking it down month by month. Of course, things like groceries, utilities or home maintenance were still my parent’s responsibilities and did not appear in our budget.  However, we had to pay for our school fees, bus passes, dance classes, soccer registration, clothes and shoes, when we went to restaurants with our friends, movies and other activities, and even things like haircuts.  My mom would allocate a certain amount of money for each category for each month and we would have to live off that money.  Any money we saved was for us to keep, but they would not give us any more money if we ran out. budget_money

We each opened a no-fees chequing account where my parents would deposit our monthly budget amount and we were responsible to pay for things from there.  I can still remember the shock on my dance teacher’s face when I paid for my classes with a cheque in my own name!  Who expects a 13 year-old to be writing a cheque for their own activities?

However, with all this freedom came a lot of responsibilities.  We now had to keep track of various payment dates, because if we missed something like soccer registration, we would be very disappointed in the summer!  We also needed to be disciplined and not spend all our money on things we wanted and not have money left for the things we needed such as winter boots for example.  My parent’s had a no-pity attitude and we quickly learnt to live with our decisions and after a winter of cold, wet feet in old boots or running shoes, let me tell you we did not make the same mistake twice!

At the time and even looking back today, I loved this experience.  I was treated like an adult and I felt my parents trusted me.  I no longer had to ask to borrow money if I was going shopping with my friends, but instead of spending large amounts of money to buying all the latest clothing trends without batting an eye, I was looking for good deals on underwear or socks to be able to surge on a pair of jeans or a shirt I had my eye on.  And let me tell you, I really enjoyed and appreciated those splurges more than my friends.

At the end of the month, we would have to log all our spending for the month, entering every receipt and every dollar spent.  We were then able to compare our spending to our initial budget to see how we fared during the month.  What categories did we overspend in? Which did we save on? And of course, the most important question, were we over or under budget overall?  Only once this was done, would my parents give us the money for the next month.


At the end of the year, we would review our budget and spending for the whole year, see how much of our money we managed to save (we quickly learnt how to live within our means and ended the year under budget).  We would discuss options for the money we saved, whether it be investing it in a GIC or high interest bank account or even donating some to charity.  Seeing as my parents would never give us more than our budget money, the only way we could go over budget was if we spent money we had made doing a summer job or received as gifts.  It was ok for us to spend this money, however, we should have been able to live within our budget and we would discuss what we should’ve done differently.  We would then make our budget for the next year, adjusting based on our spending, different activities we wanted to try or things we knew were coming up like a wedding we needed a dress for or a new snow-suit for the winter.  The point was never for our parents to spend less on us that they would’ve normally, but to give us the power over our money and spending.

Any friend I spoke to about our budget system didn’t seem sure if it was a good thing.  They were used to getting their parents to pay for what they needed and were scared that they would be spending the winter without boots, because they would go out to the movies too often.  But while they were getting 2$ a week for making their beds or cleaning their rooms, we were managing a couple hundred dollars a month and learning how to pay bills, invest our money, shop smart and live within our means, invaluable lessons that I am grateful for having been taught to at such a young age.

As we got older, our budgeting system grew with us.  For example, as soon as we turned 18, my mom insisted that we each get a credit card to gain a credit score and learn to use it responsibly and pay off our credit card statement every month. Once we started making more money with summer jobs, we adjusted our budget to take this new source of income into account. We also had to add new categories for driving when we got our license and things like cell phone plans.

This is not only a budgeting technique to be used by kids, in fact, I still use this method today for my budget, albeit with different categories!  When I moved out into my first apartment, I taught my boyfriend to make a budget and it made managing our money very easy because we knew exactly where everything was going and allowed us to easily split our expenses.  Also, when we got married we were able to easily combine our budgets to manage all our household spending.  It is also great to compare how our spending has evolved over time!

I strongly believe that any child can learn these same lessons and be better prepared for life by using this budgeting technique.  It is however important as a parent that you also follow a budget in order to lead by example.  Before rolling this out to your children, I recommend that you go through the exercise for your own spending, which will also show you how much you are spending on your children and give you a starting point for their future budget.

How do you teach your kids about the value of money?  Would you try this budgeting technique with your kids?

Share this post!

One thought

Comments are closed.