Youth need to stay healthy: physically, mentally, emotionally and don’t forget financially. It is beneficial to feed youth information from the spending pie even if they are not bringing financial support to the table. This very low calorie pie is informational and highly recommended. It’s quite fitting and adaptive, and geared towards their future financial health. Michigan State University Extension suggests serving up the following tips!

You may be tackling your taxes or looking over your yearly budget for 2016, and if you are, now is a great time to expose your children to the household budget and your spending chart. It will benefit them, and yourself, to review the categories and see what percentages you have allocated to and where your household income goes each month.

Although there are many spending plan pie charts out there, most have the same general ranges and options. Some may break down areas with more detail like dining out, cellphone, taxes or laundry. Other charts have more general categories like life, food or entertainment. The best thing you can do is make the pie chart your own. If there is a spending habit that is significant, carve out a piece for that. For example, if you generally have a monthly expense for books and gifts, toiletries and makeup, recreation or medical, then have a category for that and track it.

You may also wish to break up general categories. For example, your food category could be divided into groceries and eating out if you tend to dine out often. The point is if you wish to break down your expenses more directly, it’s your pie. Cut it to fit your needs, but there are some general categories and the recommended percentages which we will cover below.

This is also a great opportunity to talk to your youth about how the spending pie and spending habits may change over time. Expenses for a college student may be different than that of someone in their 50s. The pie may change slightly over time, but for the most part it is a good guide to stick to over a lifetime. The general expense will not change. We all need food, shelter and to pay our taxes, right?

Here are some of the pieces or categories to consider and their recommended percentages:

• Housing/rent (25-35 percent)
• Savings (10-15 percent)
• Food (5-15 percent)
• Transportation (10-15 percent)
• Insurance (10-25 percent)
• Debt (10-15 percent)
• Entertainment/recreation (10-15 percent)
• Medical/health (5-10 percent)
• Giving (5-10 percent)
• Personal (5-10 percent)

By reviewing the spending pie chart, it can give a visual to youth as to what your major expenses are and how or where you might be able to make cuts. If a big chunk of the pie is going towards transportation, you may be making too high of a car payment. If your food slice is large, you may be eating out too often and can look into cutting that piece by staying in and cooking.

Here is the benefit to your child: They get early exposure to living expenses. They are exposed to what costs they will encounter when on their own and get an understanding of what those ranges may be. They can review how much of their take-home pay should be taken out for each of the categories and they start learning to track their spending habits. You can ask them questions, like how much are utilities? How much should I spend on rent, a car, life and home insurance, or clothing? How much should be put towards savings and retirement verses paying down a debt? These are the conversation starters that will guide youth to make better decisions in the future and even today. That may help your budge pie too! Youth will gain a better understanding of what it costs to run your household and may look for ways to save.

Having youth understand budgeting and providing them an idea of allocating expenses in a household will prepare them for future financial success. It’s not “pie in the sky” efforts to keep youth on a healthy financial diet, just keep talking with them and feeding them good knowledge.

For more information, you may want to serve up what Michigan Counseling Association offers in budget recommendations along with Leave Debt Behind’s “10 Recommended Category Percentages for Your Family Budget.” For more information about money management and budgeting, check out the Money Management page on the MSU Extension and the Michigan 4-H Youth Development websites.