Ultimate Guide to Teach Kids about Money

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These days it is an absolute must to teach your kids about money. I hate to say this but we live in a very entitled world. Kids think they can have what they want when they want it and this is just not true.

If we don’t teach them the basics of being smart with money…who will?

My goal is for my children to be good at managing money when they are adults so I need to introduce them to good habits now.

Its really not hard…if I can do it, you can too.

Set a Good Example

Your babies are watching and listening to everything we say and do.

So, we need to show them by talking about what things cost and showing them how to save money. This can be done without being obvious…just talk outloud.

Example: “I have $10 kids so you can both pick a snack but you have to stay under $10…” Then as they go through the store, talk about the price and add things up for them to think about it.

I did this the other day when my youngest was spending his birthday money. After his money was gone…he said “I’m broke”. So I used that opportunity to talk to him about it.

A good thing you can do with them is get something to save coins in so they can see through. We have a clear plastic coke bottle (a piggy bank). Its clear, so they can see the coins pile up. Its always good when they can visualize and watch the money grow.

My youngest doesn’t understand how much they’re worth (the coins)…so to him a pile of pennies is the same as a pile of quarters! 😉 But being able to visualize his savings is good for him.

Teach them what things cost

I think its super important to teach our kids the cost of things. This can be done anytime you buy something or go shopping.

I like to share with mine when I buy something that is a deal or if I have a coupon. I just casually say “I’m going to get you this shirt that cost $20 but I have a 30% off coupon so its going to only be $14 because I saved $6 with this coupon.”

I like giving them examples.

It has the potential to put them in the money saving mindset. Some people say its overkill but where else are they going to learn if not from us as parents.

Show them how to Save

Just like with the coupon example, showing them how you save will teach them how to save. You can even talk to them about why you buy a certain thing at the grocery store because its 30 cents a pound cheaper or why I choose a certain brand because of the price.

grocery cart in store
Photo by Alexas_Fotos

I was taught how to save money when I was growing up and I am very grateful now because it has made me mindful of my spending habits today.

Let them know that things cost money

Its ok to talk to them about how much things cost. I just had this discussion the other day with my 16 year old about how much it costs to maintain his car. You don’t want them to go blindly into the world and have no clue about the concept.

I have even explained to my kids why I ask for a water at a restaurant….I refuse to pay $2 or more for a drink that I can get on my own cheaper. Same with a convenient store. I won’t pay $3 for a gatorade when I can buy the powder and mix it up myself. (I know I’m a bit Frugal shopper)

Chore Money

Teaching them how to earn money is important also. We started a chore chart at my house a long time ago so help teach them not only responsibility but how to earn a wage for working.

With my youngest, he gets chore money for simple things like brushing his teeth and picking up toys while my teenager gets money for dishes and lawn mowing.

We pay them set amounts for certain things. With my teen, he is earning his phone bill because it costs almost $50 per month.

teach kids money
teach kids good money habits

No Impulse Buys

Try to stay away from impulse buying in general because it is a terrible idea for your finances. But especially in front of them.

When we are at the store and my kids ask for things on a whim, I tell them no. They need to know that it is not ok to just buy whatever we want whenever we want. There is a time and place for all things and buying impulsively is a bad habit!

I will tell them things like “you can do your chores for “x” amount of weeks and you will save enough money to buy that” or I will make them wait until a birthday or Christmas depending on how close it is.

But always remember…its ok to tell them “NO”. Its a perfectly normal thing to say lol!

Give them a Bank Account

Open your teen a bank account. We did this with our teen when he turned 15. He didn’t have a job yet but we gave him money in his account for chores around the house. We also gave him a debit card (because he wrestles for the high school and he could purchase meals, ect. when they were gone to long distance tournaments).

I made him a check register that I printed and had him keep track of his purchases so that he could see visually where all the money goes.

He just said to me yesterday (after going to walmart for work shoes and a belt) “man money sure is gone fast”. I said “yes…yes it is!”

Learn to Budget

It is ok to talk to your kids and teens about a budget. You can keep it simple and give them the general idea of what it takes to create one.

You can also turn it into a game. Give them a scenario and have them figure out where things go or how to make it work in the budget.

Be Content

Show your kids that it is ok to be content with what you already have. So many times we give them the wrong idea by constantly buying new things and getting rid of things we haven’t used or had for long

They pattern themselves off of what we teach them, even if you didn’t realize you are teaching them habits.

Steer clear of credit cards

Don’t let your kids see you use a credit card to pay for things. They need to know that you can’t just charge it. (I’m not saying to never use one, just don’t let them see it as an option) When they see how easy it is to use, it could send the wrong idea.

Cheap vs Frugal
Photo by Pixabay

I can remember thinking this way about checks as a kid…”just write a check for it mom”…then she explained that it was attached to her bank account and not the money tree out back.

When your kids are old enough to talk about credit cards with, then you can talk about how to be responsible with them. Give examples of when it is ok to use them and when its not.

Let them make money

If you have a teenager, like I do, one of the best things you can do is to let them make their own money. Even if you are in a position to pay for all of their things, its still a wonderful life learning opportunity.

When I was a teen, I got a job and paid for my first car. It really helped me learn about money. My first job was babysitting, then I got a job at a nursing home (where I washed dishes and helped serve food- it was one of the most rewarding jobs I have ever had by the way).

My mom opened up a bank account for me and I learned how to keep a checkbook and manage money. Allowing your kids to do this can set them up for a good financial future.

Teach your kids good money habits while they’re young.

Its not hard to get your kids in the right money mindset for their future, they learn everything from your actions. Make sure you show them good behaviors. If you need help with your Money Mindset you can check out my Pinterest for helpful tips.

12 thoughts on “Ultimate Guide to Teach Kids about Money”

  1. These are great suggestions. I have three children also and have attempted to teach them about finances including using coupons.

    • I love that you teach them about coupons. Mine know I love a coupon lol.

  2. Yes!! This is SO important! Kids need to know that things cost money and not just be handed everything. I think it’s a great disservice to kids to not be taught the value of money and how to work for things you want! Great post!

  3. Love your list! I have been working with my son a lot lately on money management and better understanding finances and budgeting. Thanks for the reminder to get him his own savings account soon. It is so important to teach kids when they’re young important life skills like managing money.

    • Your welcome. Making them be involved in learning money is so important.

  4. These are great habits for children to get into at a young age. Financial savvy is an important skill to acquire that will pay dividends in the future!

  5. Thanks for this post. It is so important to teach kids about money and saving. We have four, and we have to constantly explain the tradeoff between buying alllll the things right now and saving for future plans like taking a nice family vacation, having a car when they get older and saving for college.

    • I’m so glad that you do talk to them about it, its so important.

    • They need to know, I feel like so many parents don’t even have a conversation with their kids about money.

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