10 Tips For Teaching Kids About Money


When it comes to money, parents are their kids’ most important teachers—whether they realize it or not. The lessons children learn by watching their parents from an early age can mean the difference between growing up to be financially secure and independent, or mired in debt and struggling to make ends meet.

Here are 10 tips you can use every day to help the kids in your life build good money habits and get the financial foundation they need to be successful.

  1. Start early, and make it hands-on. If children are old enough to count, they are old enough to get involved in the money side of the family. For example, when you buy something with cash, have your child count your change and compare it to the receipt to make sure you got back the right amount.
  2. Think out loud. When we go shopping, we think through a lot of choices that we don’t always say out loud—Which cereal is less expensive per ounce? If I buy this toy, how much more am I going to have to spend on batteries? Is it important to have the brand-name shoes, or is there something else I would rather spend the extra money on? When your kids are with you, get in the habit of saying these things out loud. Talk about how you make decisions about what to buy. This is an easy and effective way to teach your kids to think critically about spending money, and also to communicate your family’s values concerning money.
  3. Set goals. If there is a toy or other item your child has her heart set on, use it as an opportunity to practice setting a goal and saving up to reach it. (You might consider matching the child’s savings as an added encouragement.) This has the bonus effect of helping avoid impulse buys and makes the toy more meaningful when it arrives.
  4. Open their own accounts. GCU offers the Kirby Kangaroo Club account for kids that can be opened with as little as $6. Making regular deposits into their very own account can become a special ritual. Plus, they earn Kirby Bucks with each deposit that can be traded for fun prizes.
  5. Comparison shop. As kids get older, let them help you comparison shop, look for sales, and avoid paying for overpriced items. This is also a good opportunity to teach them how to think critically about advertisements.
  6. Bring out the bills. Parents often wait until the kids are in bed or at school to pay the bills. Instead, let them see what you’re doing and talk with them about why it’s important to take care of needs before spending money on wants.
  7. Make a simple kid-sized budget. If you give an allowance, pay it in small bills that can be divided into a simple hands-on budget system. For example, you might have the child decorate three jars—one for money to save, one for money to spend and one for money to give to charity, or save for a sibling’s birthday gift. You can then decide together how much of the allowance will go into each jar on “payday.”
  8. Show how time=money. For most parents, kids are more likely to be watching when we spend money than when we earn it. They often have very little idea of how much things really cost, or how much work it took to earn the money to pay for it. As kids get older and start earning some money of their own, talk with them about how much things cost in terms of time they spent working. When they can get in the habit of thinking, “That cell phone would cost me 10 hours of babysitting,” they’re more likely to weigh purchases carefully.
  9. Remember: cards are hard. Especially for younger kids, it can be really tough to make the connection between paying with a debit card and paying with money they can touch.  When you use cards at the store, be sure to explain how using a card still means spending real money, just as if you had used cash.
  10. Give them a way to pitch in. For kids who are used to contributing in some way to the family budget, it comes as much less of a shock when they move out on their own and are suddenly responsible for paying their own bills. Try making children responsible for a few of their own expenses, increasing the amount as they get older and gain more responsibility.


Taking the time to develop good money skills now will help your children achieve financial success throughout their lives. They will be thankful it was part of their education.