Question: How do you tell a child that you just can't afford a toy she wants? I'm newly divorced, and my 6-year-old wants something that costs $150 because her friends have it. This is not in my budget, but how can I get her to understand that?

Answer: Saying you can't afford something can be confusing for the child when the family is buying other things on a regular basis. Young children don't naturally understand the need to prioritize spending.

But, as with any life skill, parents need to help their children learn to become smart consumers.

Experts feel that by age 6 children can grasp the concept of money. Talk frankly with your daughter, telling her that the toy she wants is expensive -- and that there's a way she can buy it herself.

Encourage her to save her birthday or holiday gift money, and pay her small amounts for completing extra chores around the house. Let friends and family know she's saving for something when they ask what she'd like for special occasions. Create a chart that will help her see her progress toward the goal.

By allowing her to set a goal and earn the money, you're helping her learn financial responsibility while building her self-confidence.

It may take a while -- and, for something this expensive, you may want to assist the process in whatever ways you can comfortably afford -- but think of the sense of accomplishment both of you will feel when she reaches her goal!

Meanwhile, don't overlook the fact that your daughter might be feeling left out because her friends have something she doesn't. Talk with her about how she can still be part of what her friends are doing even if she doesn't have the same toy. For example, she can tell them about her "savings" project and keep them posted on her progress. That may help her counter any peer pressure she might be feeling -- and her friends may actually find that they want to do some saving of their own.

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