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Financial Education

How to Teach Kids and Teens Smart Money Habits

Mother and young daughter seated in living room, putting change into a jar.
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Think back to how you formed your financial habits. Did you learn everything you needed in school? From your parents? If you could go back and talk to your younger self, what financial pitfalls would you tell yourself to avoid?

If you have children, you may be wondering how and when to start teaching them smart financial habits like saving early and spending responsibly. Younger kids enjoy the process of learning and earning rewards, while teens will be motivated to learn because they are yearning for financial independence. As a parent, you can capitalize on these wants to help teach your children to build a strong financial foundation for their future. If you’re not sure where to start, here are a few activities to help.

Money Activities For Kids

Even pre-school aged children can start learning money habits and early math skills. The activities below use children’s natural curiosity to learn as well as their reward-orientated motivation to encourage their money awareness.

  1. Use a clear jar instead of a piggy bank to save money. They’ll be able to see and enjoy the money as they watch it grow.
  2. Create a chore or simple money-earning task for your child. Then have them put some money aside for saving while allowing them to spend the rest on themselves or someone else. This will start to show them what items actually cost while reinforcing that they should always save first.
  3. Send your kids on a house and car scavenger hunt looking for loose change. Then you can either have them put the coins directly into their savings jar or they can sort the coins and put them into coin wrappers.
  4. Start a family game night with board games that involve collecting and spending money. Search online for versions of popular board games that have been adapted for younger players.
  5. Roleplay with your kids going to the grocery store, or to your financial institution. Let them fill out checks and deposit slips. You can even pretend they are running their own business. Use their natural creativity to engage them in play that plants seeds of financial responsibility.

Teens And Money

Teaching teens smart money habits, or anything really, can be a challenge. However, with the right motivation and a lot of patience from you, your teens can learn to manage their finances.

  1. Sit down and have a talk with them. Teens value honesty and authenticity. Share with them the financial mistakes you have made. They will appreciate your ability to admit you aren’t perfect. They may not take your advice off the bat, but you are planting seeds that will blossom later as they mature.
  2. If they don’t already have one, set your teen up with a checking and savings account (you may need to make it a joint or custodial account). Your teen will gain the feeling of autonomy while still giving you some oversight on their spending habits.
  3. Encourage them to think of some large, but fun purchase they want to make. It can be anything from saving for prom, buying a new car, or going on a spring break trip. Help them budget for the expenditure and think of creative ideas to earn the money for it. If they know they will be spending their money on something fun, they will be more likely to save for it. If you’re able, you can even match their savings as a reward for their discipline and focus.
  4. Find an online investment simulator geared for teens. A simple google search can find a few programs, some even allow teens to earn dividends. Whether real or a simulation, these programs are simplified investment plans to teach teens how to invest, buy, sell, and trade on stocks. If you have more than one teen, you can turn it into a simulated competition to see who can earn the most.
  5. Help your teen research the costs of colleges and the starting salaries of the career path they are considering. Have your teen look up the cost of the college tuition, living costs and books for the college they’re hoping to attend. Then, compare those numbers with the starting salaries for their dream job. This may be a huge reality check for some teens. You can use the opportunity to discuss their education goals and the best ways to pay for tuition and books. Student loans, scholarships and part-time jobs can all be part of the discussion.

One of the best ways to teach your children is to lead by example. This is an opportunity for you to stay on track financially and discuss mistakes that you may have made along the way. In the end, your honesty and consistency about financial habits will stick with your children for many years, even if they don’t seem open to it at first. Keep the faith, and your patience, and you can prepare your children for a lifetime of financial success.

How to Open a Quorum Membership for Your Child:

  • 18 years and older: Click here to open a Quorum membership online.
  • Ages 16-17: Click here to download the membership application for minors.
  • Ages 15 and younger: Click here to download our custodial account application.

*Note: If a minor requests to open a checking or savings account and their age is 16 – 17, then a parent or legal guardian MUST be named as a joint account holder, and all associated services are available to the minor. (e.g., debit card, online banking, combined statement, etc.)

If a minor requests to open a savings account and their age is 15 and younger, a custodian MUST be named. If a minor requests to open a checking account and their age is 15 and younger, an account cannot be opened.

Source: Balance Financial Fitness

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CUNA 2023 diamond award trophy icon

CUNA 2023 Diamond Award Winner

Financial Education

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