Adulting 101: Teaching kids about money

Talking to kids about money can be tricky. But learning how money works is important and it’s best to start early. When kids understand saving, spending and earning, they’re more ready for real life. 

Here are some easy ways parents can teach kids about money basics.  

Set a foundation 

Do not overcomplicate the conversation! Start with the main foundation of all things money: saving, spending and sharing. 

The 3 big ideas are: 

• Save for emergencies or goals. 
• Spend wisely and within limits. 
• Share to show what matters to you. 

These habits help kids learn that money is about choices — not just having more of it. 

When should kids get a bank account? 

There is no perfect age. Parents know their kids best. If your child gets money from gifts or chores, a savings account can be a good start. Use labeled jars to visually show how saving works and take your child to the bank, so they see it is a safe and friendly place. (Bonus, they might get candy or a sucker, too.) 

As kids get older and start earning money, they might be ready for a checking account and debit card. Many schools and activities don’t use cash anymore, so having a debit card can help. Parents of minors stay on the account and can see all transactions and can often even move money via their own online banking accounts if necessary. 

Short-term vs. long-term savings 

Help kids save for something small like a toy and then let them spend it. That shows how saving works. You can also talk about saving for bigger things like college, and how to reach that larger goal over time. Show your own savings habits, too. Say things like, “I saved for months to buy this TV and now we get to enjoy it by watching our favorite movie!” 

Use everyday moments to teach 

Money choices happen all the time. At the store, give your child a small amount to spend. Let them choose: “If you buy this candy bar, you won’t have enough for that toy.” This teaches opportunity cost — how choosing one thing means giving up another. 

You can also talk about choices with time. Ask, “Do you want to go to the playground or do crafts at home?” Time choices help kids understand how decisions work. 

Teach about cards and digital money 

Debit and credit cards can be confusing. Let kids watch what you do. When you pay bills or shop online explain what’s happening. Show them which card you’re using and why. Talk about how credit means borrowing money and why it’s important to be careful. 

Help kids earn money 

Kids learn a lot by earning money. You can help them by assigning chores or helping to find age-appropriate jobs like babysitting, mowing lawns or walking pets. Ask questions like, “If you want that video game how will you earn it?” For teens who want a car, help them plan and save early. Talk about what you’ll help with like insurance or a down payment. 

Talk often and ask for help when needed 

Apps and tools can help, but talking is the most important thing. Be open with your kids about money. Let them ask questions. If you don’t know something talk to other parents or ask a financial expert. It’s okay to need help — kids learn from how you handle things, too. 

Additional resources: 

CommunityAmerica Parenting & Money Webinar