BETA
This is a BETA experience. You may opt-out by clicking here
Edit Story

Fun Ways To Teach Kids Great Money Habits

Capital One

By Jennifer Brunton

Every parent wants to give their children the skills they’ll need to succeed. When it comes to finances, part of that means teaching kids money management.

Here are some enjoyable ways families can work together to build responsible financial habits at an early age. 

Discuss Financial Choices

Modeling healthy financial behavior around your children can send them positive messages that can help them later in life. 

If you’re open about the decisions you make to keep your family’s finances on track, kids may feel respected and included in what’s going on around them.

Consider fun ways to include them in the decision-making process. And let them join in discussions about where your money goes. 

Explore Ways To Earn

Whether you give your kids an allowance or not, it can be healthy for children to earn money to buy stuff they want. The key is to make the work fun. Try playing music while everyone does a half-hour of cleanup. A speed-raking contest is another good contest.

It can help to gear tasks to your child’s age. Even toddlers can begin to pitch in and earn small sums for toys and treats. Older kids can look into finding a part-time job that matches their abilities and interests. 

When children earn their own money, they may be more likely to care about how it’s spent. 

Develop A Spend-Save-Donate Routine

One way to help kids pick up fantastic money habits is through a spend-save-donate approach. The method encourages them to divide their earnings into three equal parts. They can spend a portion of it, sure. But they also save and donate, too.

This system could help build math skills. It could also help them handle their money in a constructive way. Letting kids choose how to spend some of their funds can build independence. A saving routine can teach kids to plan wisely. And giving to charity can foster compassion and a sense of responsibility. 

Make it a ritual to divvy up your child’s cash. Enhance the experience by decorating three envelopes or jars to organize earnings. Label each and keep them all in a special place. 

Here are some tips for handling each portion: 

1. Spend: Experiment With Budgeting 

Developing a budget and learning to distinguish needs from wants is one place to start. 

It also may be helpful to teach your child to compare prices and avoid impulse buys. Some older children may be able to perform simple calculations in order to stay within budget. 

2. Save: Practice Patience And Think Long-Term 

Saving can help children think about the future. It also encourages a patient approach to money management. 

Some families may decide that savings should go toward paying for college or a car. Others may have children save for big-ticket wants, such as the latest video game console. 

3. Donate: Give Mindfully

Children might want to regularly allocate the funds they’ve set aside for donations. Look into giving options that align with your family’s concerns and interests. 

The good feelings that come with selfless behavior could create an incentive for children to continue giving throughout their lives. And many nonprofit organizations offer ways to keep up with beneficiaries, allowing your child to track the impact of their donations over time.

A good grasp of personal finance can give children a head start. Make learning about money fun, and you could find that your little financial whizzes are having a blast. 

A former academic turned freelance writer and editor, Jennifer Brunton lives and works in Vermont.

This article is for educational purposes only, and is not intended to provide medical or legal advice, or to indicate the availability or suitability of any product or service for your unique circumstances.

Capital One does not provide, endorse, or guarantee any third-party product, service, information or recommendation listed above. The third parties listed are solely responsible for their products and services, and all trademarks listed are the property of their respective owners.