How to Teach Your Kids About Money

Okay, let's be honest. Talking about money with kids can feel awkward. But in 2025, with inflation still a factor and the cost of everything seemingly skyrocketing, equipping our children with solid financial skills is absolutely crucial. It’s not just about them learning to save for a new gadget; it’s about building a lifetime of responsible financial habits.

Let’s face it, most of us didn’t get a fantastic financial education ourselves. But we can do a better job for our kids. Here's a breakdown of how to start, broken down by age group:

Preschool (Ages 3-5): Introducing the Concept of “Value”

At this age, it's all about laying the groundwork. Don’t overwhelm them with numbers. Instead:

Use tangible examples: “This toy costs money. We have to earn the money to buy it.” "This apple costs money, and we can use our allowance to buy it."
Play pretend: Set up a little shop with toys and let them "buy" things with pretend money.
Introduce the idea of saving: "Let's put some money in this piggy bank. We can save it for something special."

Elementary School (Ages 6-11): Allowance and Simple Budgeting

Now you can start introducing more concrete concepts:

Start an allowance: Even a small amount can be a powerful teaching tool. Tie it to chores – this helps them understand that money is earned.
Help them create a simple budget: "Okay, you have $5. Let's decide how much you want to spend on candy, and how much you want to save." Use a visual aid like a chart or a jar labeled "Save," "Spend," and "Share."
Discuss needs vs. wants: “We need food and clothes, but a new video game is a want.”

Middle School (Ages 12-14): Expanding Financial Knowledge

This is a great time to introduce more complex ideas:

Open a savings account: Let them learn how a bank works.
Discuss advertising and marketing: “Why do companies try to make us want their products?”
Introduce the concept of interest: “When we put money in the bank, the bank pays us a little extra!”
Start small goals: Encourage them to save for a larger purchase they really want.

High School (Ages 15-18): Real-World Financial Decisions

At this stage, you can really delve into more serious topics:

Discuss credit cards (responsibly!): Explain how interest works and the importance of paying on time. Maybe even consider a secured card with a small limit.
Talk about investing (even a little bit): Introduce the idea of stocks and bonds – explain it in a way they can understand.
Encourage part-time jobs: Working gives them a firsthand experience of earning and managing money.
Help them create a long-term savings plan: College, a car...start thinking about the future.

Important Note: Be a good role model! Your kids are watching how you handle money. Transparency and open communication are key. Don't be afraid to talk about your own financial mistakes – it’s a great opportunity for learning.

Resources: (I'll be adding links to some helpful online resources for families here soon!)