12 ways to teach kids about money


Teaching kids sooner rather than later about money and debt can pay off substantially. Using credit responsibly and living within your means are valuable financial habits that cannot be taught quickly.

Rather, a well-rounded financial education occurs over time with age-appropriate lessons, many of which are conveniently disguised as fun.

Use these techniques to help your kids grow into financially savvy young adults.

Lela Davidson is a former CPA and the author of Blacklisted from the PTA, a collection of irreverent essays about motherhood and the modern family.


  1. Just say no: Refuse to buy things for young children when they are at the store with you. No trinket is more valuable than the real gift you give your child by denying instant gratification. If you give in, your child-who is too young to understand money-simply will learn that when they want something, they get it.
  2. Create a currency: Start your own economy. Kids love to earn gold stars, bottle caps or other "currency" that can be exchanged for the things they want. The more tactile the better. Start with stickers on a chart and work your way up to physical objects the child can hold and manipulate. Added bonus: math skills!
  3. Make believe with money: Little kids love to play pretend. Provide toys that encourage fiscal play, like toy cash registers, scanners, and ATM machines. Let them empty the pantry to set up a store or encourage them to hold a bake sale with Play-Doh pies.

Grade School

  1. Put them to work: Transition from play money to real cash. School-age children are old enough to start saving for that iPod or buying their own candy at the store. Whether in exchange for specific chores or as an allowance, allow your children to earn their own money. It's a powerful first step toward eventual independence.
  2. Hello, Monopoly!: Give kids games that teach financial concepts and play with them. (Try playing for a set time instead of to the game's legendary bitter end.) In addition to the classic real estate trading game, there are others that teach realistic money skills. Check out Rich Dad Cashflow for Kids, a comprehensive fiscal education system created by Rich Dad, Poor Dad author Robert Kiyosaki.
  3. Make a deposit: Kids this age are old enough to have a bank account. Make a point of reviewing the bank statement with them each month, paying special attention to the concept of interest. Encourage kids to make regular deposits, keeping some of their cash for spending and donating, while saving the rest.

  1. Paying their way: By the tween years, kids should start to be responsible for some of their own expenses. It's one thing to earn money and another to live under the constraints of that finite resource. Consider making them pay for some of their own expenses, such as school supplies or birthday gifts for friends.
  2. Nurture budding tycoons: You can spot the entrepreneurial kids by this age. For kids who show an interest in business, consider an online stock or small business simulator game offered by many websites, including Investopedia.
  3. Cultivate the value of giving: This is a great time to teach kids the importance of using money for community good. Business skills can be sharpened and philanthropic traits nurtured by encouraging kids to help causes they care about. Animal shelters are popular.

High School

  1. Get a real job: Depending on school workload, this is the time to get a job, take on responsibilities in the family business, or even start a venture of their own. Just make sure you know where that paycheck is going.
  2. Swipe it!: Make sure kids learn how to use credit before they leave home. Start with prepaid debit cards, and then transition to low-limit credit cards. The key is living within their means, so teach them to pay the bill in full at the end of the month.
  3. Collect for insurance: If your child drives, consider requiring him to pay for the insurance. The clear connection between the cost and the privilege will make an impression.
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