How To Teach Your Kids About Money

I am so inspired by Laura’s tips! #3 & #4 are on my to-do list for tomorrow!!!!!


By Laura Harris | piggybankdreams.com

As parents, we have the incredible (and terrifying) opportunity of teaching our children about money. Some people may view money as unnecessary in a child’s life, but I would say the opposite is true. I’m not talking about teaching your kids to get rich. Nor am I talking about Saturday morning insurance lectures at the breakfast table. Yaaaawn.

We’re talking simpler, more impactful stuff than that. School will teach them to count money. Ads and credit card companies will try to convince them where to spend it. But who will teach them how to save, how to be generous, how to develop a strong work ethic, how to be grateful, responsible and content?Why not you?
It all starts with a simple conversation. Think back to your childhood. When did lessons about money happen? I learned just as much folding socks when I was five, as I did when I got my first job at 16. It’s never too late nor too early to start the conversation.
Some facts we learn just by observation. Your children are observing you. Create teachable moments! If Full House could do it at the end of every episode with inspirational music and heart-to-heart dialogue, so can you.

Here are nine financial conversation starters:

1. Talk your children through your next purchase

Tell them why you’re buying the item (i.e. gasoline to keep the car running, a coat to stay warm, etc), how the money was earned, and how much time it took to earn it. Say something like, “It took daddy/mommy three hours of work to pay for the gasoline we put in this car today.” This will help your children realize that money comes from WORK. It didn’t grow on the maple trees in the front yard!

2. Involve them in your next donation

Explain to your children why you give. Tithing, donating, sponsoring a child in need, or some other giving is planting a seed of generosity in your children. Find ways to involve them in the next donation. Some ideas: taking cookies to a neighbor, sorting old toys to donate to Salvation Army, adopting a family through the Christmas Bureau.

3. Hire them!

Give your kids a chance to work for money, whether it’s just for one job or a new routine. Tell them about your first job. How did that shape your work ethic? Also, try to be a good boss. Pay consistently. Show, rather than tell, how to have a positive attitude about work.

4. Use cash

What would happen if your children saw how much physical cash it took to buy a week’s worth of groceries to feed your family? Hopefully, this opens the door to more discussions about gratitude, especially if you discuss how many places in the world don’t have enough food or clean water.

5. Set up budget envelopes for the kids

A fun way to teach your children to budget is to grab three envelopes (jars, bins, or anything else!) and label them Save, Give, and Spend.

Let them decorate the envelopes if they want. Help them divide their chore or work money into each envelope. As you know with budgeting, living on it is the hardest part. But, it also yields the greatest reward (like the first time they pay for something with their own hard-earned money).

6. Start a family piggy bank for fun events.

Label it, put it somewhere everyone sees it, and tell your children your WHOLE family will go on a special trip like the zoo, an amusement park, or camping. Everyone can contribute to the piggy bank. Set a deadline and talk about the concept of planning ahead and patience.

7. Implement a family “free night”

Schedule a night to do something as a family that is intentionally free. Explain that you can still have fun without spending money. Some ideas include:
a. Camping in the living room
b. Family movie night (DVD borrowed from the library) with popcorn
c. Picnic at the park
d. Free local events (check your library or online)

8. Read a book about money with your child

It could be anything from who’s on the one dollar bill to starting your first lemonade stand. Books naturally spark discussions and may help you better illustrate a lesson you’re trying to teach. Here are a few fun books about money I read to my children.

9. Share a story from your childhood.

This one is my favorite. What’s the first big purchase you made with your own money? What did your first piggy bank look like? Kids can learn so much from our own experiences. Just start sharing them and you’ll see!


 About the author

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Laura Harris is a wife, mother, writer and financial coach. When she’s not on an adventure with her family or curled up on the couch with a book, you can find her blogging about personal finance at Piggy Bank Dreams.