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Money Education for Children

Updated on June 25, 2014

The First Experience with Money

Nowadays, children come into contact with money from a very young age, since it is often that children accompany their parents to the shops. Children also have heard a lot of things about money, some bad and some good. Usually though, children are exposed to an environment that has a negative connotation and feeling to money. More and more children listen to their parents arguing about money and in the event they ask for something, they get a very common answer: ‘we can’t afford that’.

Understandably, we, the adults, have gone through this situation ourselves and have carried it forward to this moment. If we think for a minute our first experience with money and how that made us feel, then we surely can understand how our children feel. Some people have been raised with a lot of money and others with little money. The feeling that our children will have towards money for the rest of their lives, starts at a very young age.

Creating a Healthy Relationship with Money

Money is part of our lives and instead of making into something scary and bad, we need to take care of it, the same way we take care of ourselves. It is tool and it serves a purpose. The way that we handle money and manage it, can be the root of bad or good things. Therefore, creating a healthy relationship with money at a young age can lay the foundation for a successful and fearless life. How do we do that?

There are many ways to talk about money with children. It can be fun as well!

1. A good place to start is showing children how money is used for daily exchanges of goods or services, for example, buying a bus ticket, buying milk etc. So next time you go to the local grocery shop, try giving your children the exact amount of money and let them hand over the money and receive a product. You can then talk about the prices of different things but also about the way that the shop owner makes money by selling these products.

2. Make it a habit for your child to divide the amount of money they have into SPEND, SAVE & INVEST piggy banks. Every time someone gives them money they can decide how much they will put in each one. It is a very good opportunity to discuss about decisions we make over our spending and budgeting for things.

3. Make and play games around money that are spent, invested or saved. It is very good idea to use money-related language and a game is the perfect place for that. Your child won’t feel that you are teaching them something boring but they get very used to financial literacy.

4. Make lists of goals that the family or themselves want to achieve. Draw up a mind map and set deadlines. Involve your child in discussions on household finances and ask for their opinion.

5. Incorporate discussions about how to live within your means and looking after the pennies. Teach about saving on bills, e.g. electricity bill-turning off lights. In addition, when are going for food shopping, make a list and ask your child to hold on to it and discuss about the difference in prices.(I know that can be hard to do and I find myself laughing as I am writing this. I am thinking that whenever I go to the supermarket I am in such a hurry that discussions are out of the question. But it definitely needs to change!!!)

In difficult times, do not forget:

Children are most of the times the mirror of our emotions, fears and worries. In the world, there are different situations that children are exposed to. In the western world, the last few years, there is a climate of uncertainty and financial troubles. The economic crisis is something that is affecting all of us, little or a lot, and it is going to be the centre of adult discussions.

Children witness this situation and grow in a family where the parents might have lost their job, their home and most likely they talk about it very often. Children are not immune to this and they sense our fears and worries about the future.

Children though, need to be protected from the negativity and shown how to be resilient and fearless.

A final thought

The most important thing of all is that our children grow up to become confident with money and be able to live a stress-free life. If you manage your money, know what you have and set goals to achieve the things you want, there is no doubt that you will a happy and successful person. That is what I want for my daughter to be and for all children of the world.

© 2014 DemiT


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    • DemiT profile imageAUTHOR


      4 years ago from Greece

      Thank you Denise for your contribution to this hub. I totally agree that we all should learn from our mistakes. The key to to money management is that we try not to do the same mistakes twice. Learning from experience is the only way to become better at anything.

    • denise.w.anderson profile image

      Denise W Anderson 

      4 years ago from Bismarck, North Dakota

      Children definitely need to have experience with money before they leave home to be on their own! I have seen some disasters waiting to happen when children have not learned vital skills by the time they are teenagers. In our home, we had certain jobs that were specifically for the earning of money. As the children did these jobs, they were paid a certain amount of discretionary funding that they could then use as described in this hub. We talked about what money was and how to use it wisely. Savings accounts were set up and contributed to regularly. Each child obtained a checking account when they were old enough to do so, and learned how to reconcile their accounts. Even after all this, our children made some interesting mistakes after they left home! We all have to learn by our own experiences!


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