The Money Talk: Helping Kids Become Smarter Spenders

Whether we like it or not, money remains at the center of what we do. It is what our futures are built on - whether we want children, where we move, what jobs we seek, how we spend our lives. But money is complicated and often much, much more than a simple act of buying and selling at whim. Teaching our children how to handle and save money may be one of the most valuable lessons we can ever give, as money will be among the core factors that enhance their future independence. If teaching your children about money seems difficult, there's no need to worry - below, we break down the most important elements to cover, from spending smart to saving big.

Give kids hands-on experience with money

The best way to introduce children to the concept of money is to start it at home. This can be done simply by giving children an allowance for doing their household chores. It shows them that, just like their mom and dad, they have to do work in order to receive money. Giving children extra chores to do for extra money will also instill a strong work ethic while further implementing the fact that more work will result in more money.

Borrowing money

As your children get older, introduce them to the idea of credit. Allow them to borrow money from you to make a large purchase and talk with them about how much of their allowance they will give you each week to pay the purchase back. Talk to them about the concept of interest and why it's important to be cautious about taking out loans in the future that will have interest rates.


It's always good to inform children about the types of choices you and your spouse have to make concerning budgeting, shopping, investing, and paying bills. Letting your child be part of the conversation will show them how intricate responsible money management can be. The payoff will be worth it - familiarizing your child with serious money management decisions will help them prepare for their own decisions they will have to make later in life.


While all of these tips can teach children how to be responsible with their money, letting them learn on their own with small purchases will always be the most effective way. Teach them that if they want a shiny new dress or the new pair of shoes, they might not have enough money later to buy the video game they really want or the new bicycle. If children make small mistakes now, it will prevent them from making bigger ones as adults.

There are dozens of ways to teach our children about money. But as long as responsible money management is an ongoing conversation at home, children will continue to learn more as they grow older and begin working real jobs and saving money for college. By giving them opportunities and structured freedom with their money, the experiences they will learn now will help them shape a much healthier and more responsible financial future.