Using Lunch Money to Teach Budgeting Skills

School lunches...Lunch box or cafeteria food? Sandwich or yogurt? Milk or water?

I have been discussing these choices with my children since my daughter started kindergarten in 1999. She is a senior now and my boys are in 9th, 6th and 3rd grades so I have a few more years of school lunches ahead of me.

A few years ago, I discovered that the issue of lunch money can provide an excellent opportunity to involve kids in budgeting and help them practice their money management skills.

When my oldest son started middle school, he and I were both unprepared for the lunch costs. (My daughter took her lunch every day so I was blissfully unaware of the expanded choices in middle school!) The school still had the basic lunch option which is very reasonable from a cost standpoint. However, the middle school also offered a la carte items, such as chicken fingers, pizza and fries.

My son thought this was marvelous and was buying a la carte items every day. At the end of the second week of school, he had spent practically all of his lunch money for the entire month. I reviewed his purchases online and realized that he was spending $5-$6 a day on lunch.

This discovery led to a great conversation between my son and me. We talked about how much lunch money each child in our family is budgeted to receive.  Together, we decided that I would put a set amount of money in his lunch account at the beginning of each month. Once that money was gone, he would need to take a sack lunch until the next month’s money was deposited. 

Based upon that plan, he created a solution that worked well for him. He decided to buy the standard school entrée most of the time. Once or twice a week, he would then treat himself to the a la carte items. He preferred this system because he could still get a hot lunch every day and avoided bringing the dreaded sandwich from home. 

I was pleased with the solution because it stuck to our budget and gave him control over how he allocated his lunch money. My son did really well with this system and only had to take a sack lunch a few times that year. He is now in the 9th grade and still sticks to his plan.

Middle school kids can definitely understand the concept of budgeting. However, making it relevant to their world can often be a challenge. Using lunch money to practice budgeting allows kids to make the connection between their real life and an important financial literacy skill.

Do you have ideas for incorporating financial literacy skills into the everyday life of your child?  Please share your ideas in the comments.