How should parents teach kids about money? What an expert says you should know
Teaching kids about money can feel intimidating, especially for parents who didn’t grow up having those conversations themselves. It’s easy to assume those lessons start later, like when a child gets their first job, but by then, some habits may already be set.
So when should parents start talking about saving, budgeting and credit? And what should those lessons actually look like at different ages?
Financial literacy expert Afua Jones said those lessons can start in everyday moments kids already experience.
Here’s what to know.
How can I start teaching my kids about money?
The first step is less about teaching, and more about what kids are exposed to.
“I think It’s important for children to hear their parents talk about budgeting bills and planning to remove the mystery behind it,” Jones said. “Using real life examples, like showing how the lights are turned on and how the water runs, things associated with a bill, can begin to normalize the conversation.”
Jones said kids can start learning about money as early as kindergarten, but what works for a 6-year-old won’t work the same for a teenager.
She said younger kids tend to learn best when they can actually see it.
“There’s the piggy bank method where you take mason jars and put something on them for a certain purpose, like invest, spend, donate, or save,” Jones said. “Those kinds of things give children visuals to understand the concepts of earning and saving early on so you can introduce concepts like needs versus wants to prevent impulsive spending later.”
As kids get older, those lessons can shift toward their own goals and more real-life situations.
“For middle school kids, you can talk about goals and desires they would like to save for. They may be looking for a special gift for their birthday or Christmas, so that could open the door,” Jones said. “With the high schooler, you can use more real life examples of how you earn, because they may be thinking about having a job, or, if you’re a Christian, you could also use that opportunity to talk about tithing and giving.”
Should kids have a bank account?
Yes, but it works best when It's used as a teaching tool.
Jones said giving kids controlled access to money can help them learn responsibility early, especially with accounts parents can monitor.
“One month, give them the opportunity to show their responsibility by allowing them to do what they do, and then use that month’s statement as an example to discuss spending habits and if what they spent was necessary,” she said. “That will teach them discipline, like needs versus wants and how it will affect them.”
Jones said that same discipline carries over when it comes to credit. She said many parents don’t realize they can help their kids build credit before they leave high school.
“By 16, you can put your child down as an authorized user on a good credit card. It should be a credit card that has a good history, a low balance, not late,” Jones said. “I do not suggest that you give them the card or even tell them that you’re doing it. The whole point of doing it is to establish your child’s credit history, so when they’re ready to go get their first apartment, they’ve already got a five-year credit history, and now you’re passing on a legacy of good credit instead of them starting off at 18, getting that first credit card and not really knowing what to do with it.”
How can I help my kids make smart money decisions?
Kids are already exposed to entrepreneurship through apps like Shopify and TikTok Shop, Jones said, so parents can build on that to show how to make good choices with money.
“You can take a lawn care business, for example, and explain how they may use dad’s lawnmower, but gas has to go in that lawnmower for it to work, so they have to have money set aside for maintenance and to keep the business going,” Jones said. “Everything revolves around entrepreneurship, money and budgeting. If they want to go to dinner with a friend, go to the movies or whatever it may be, those are all opportunities to have a conversation about saving, discipline and needs versus wants.”
Jones said those everyday examples can lead to bigger conversations about money.
“For example, if they say they’re into coding, you could find a coding camp for them and talk about the money behind that, like what it costs, what type of salary they would get if they entered a profession for it, and so on,” she said. “Goals take money and that’s going to open up a conversation about their desires and then ultimately, financial literacy.”
