Starting your children off with an understanding of finances is very important, especially these days, as living in debt is a common way of life for so many. It is vital that children understand and respect money, and here are some important lessons to teach them.

1. Money Does Not Grow On Trees
Children do not understand (at least not at first) that there is not an unlimited supply of money at the bank, or on the credit card. If they see something they want to buy, you will often hear "Why don't you put it on the credit card?" or, "Write a check!" They only see you pay for your purchases this way; they do not understand that you have to use actual money to eventually pay for the items. Explain to your kids that there are alternative forms of payment, but that you can only actually buy things that you will be able to pay for with money you’ve earned.  

2. Saying "No" To Some Unnecessary Things
One of the most valuable lessons a child can learn is to willingly choose to say "No" to some purchases, even if they want it. One of the greatest incentives a child can be given is to point out that something better can be obtained if they are willing to wait and save a little longer for it. Do not give your kids money every time they want it, because this teaches them that there is a bottomless supply of it.

3. It Is Important To Save
Besides saving for something that they really want, which is a good reason in itself, teach your kids to save for unexpected things. For instance, if they receive a regular allowance, or are working after school and earning some money on their own, teach them to put aside a regular percentage -- say 10% to 15%.

4. Comparison Shopping
Let your children know that there is a vast difference in the quality of similar products. There is also more than one place that sells most items, and somewhere there may be a better deal. Show kids that by looking around, and waiting a little longer, they may be able to get the item they really wanted and maybe even have a little money left over.

5. Establish a Budget
Once your child receives a regular amount of money, you should show them how to plan to use it wisely. Teach them that money should be set aside for three different basic things: money to spend now (like on a candy bar or a movie with friends), money for special purchases that require savings (like Christmas presents for the family, or an expensive video game), and long-term savings.

6. Teach Them About Credit Cards
Credit cards and checking accounts are similar in that they provide ease of purchase without the necessity of carrying cash. Your children only see you handing over the plastic, or another piece of paper, but they never see actual cash being involved. Teach your kids about monthly payments and the evils of interest charges, and that they should never buy more than what you can afford, because the bills will come!

7. Give Regularly To Good Causes
One of the greatest joys that a child can have in regard to their own money is realizing the joy that comes from willingly donating to causes greater than themselves. By learning to give some of their money to causes such as their church, or a charity, they learn that their money can be a blessing to others, which can prevent a stingy and/or selfish outlook on life and money.