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by Kimberly Blaker
Freelance Parenting Writer
Business Woman MagazineMay 2017 (among others)


Scroll below clips to read the complete article.









According to a 2016 report by Sallie Mae, “Majoring in Money,” students aged 18 to 24 carried an average credit card debt of $906 in 2015. This exemplifies the point made by Nellie Mae in a 2013 report that credit card usage isn’t going to go away. The average credit card balance carried by college students just 3 years prior was only $499.

Educating kids on how to use credit cards responsibly is, therefore, crucial to their future financial well-being. But there’s good news for those who learn and develop good saving habits early in life. They’re more prepared to deal with what lies ahead and develop into financially responsible adults.

How to teach your kids about money while they’re young

Begin teaching your child the concept of money, including the values of coins, from the ages of 4 to 6. During this time keep it simple. Allow your child to earn money to save in a piggy bank for small chores.

How to teach your kids about money in their elementary years

By the time your child is 7, an allowance is essential to learning about money and developing good habits. Familiarize your children with banking. Open a savings account so they can watch their money grow. Also, help set achievable goals, such as saving for a new toy or putting away for holiday gifts.



Keep in mind, many banks charge service fees unless a minimum balance is kept, and frequent trips to the bank may be impossible. As an alternative, set up your own ‘family bank.’ Give your child a spare checkbook ledger or savings passbook. Then copy blank savings deposit and withdrawal slips from your bank for your children to use. Require them to fill out the slips and log transactions in the ledger. Also, give your children monthly interest for their savings so they can experience the immediate reward of saving money.

How to teach your kids about money during adolescence

Designer clothing, entertainment, and car expenses are the biggest areas of teen spending. Some teens also put away for college. But few are prepared for the adult world, says developmental psychologist Nancy J. Cobb in Adolescence: Continuity, Change, and Diversity. That’s because most teens aren’t primed for the responsibility of paying for food, housing, and health care costs.

Those teens involved with the family budget and who contribute to family expenses learn a valuable lesson. Opting to show teens the spending categories in which they have a direct impact on family expenses is helpful. Also, agree on a reasonable amount in which your teens can contribute to help cover those expenses. It’ll go a long way toward preparing teens for adulthood.

Whether teens contribute or not, their working hours should be limited to no more than 10 to 15 per week. According to Cobb, researchers have found adolescents who work, especially 20 or more hours per week, are not as engaged in school as their nonworking peers. Based on various studies, this shortchanges students in the long-term. If you restrict your teens’ working hours to ensure success in school, it’s good to provide an increased allowance for clothing and personal needs. You can then help your teens to budget their money.




Still, there are many ways teens can learn the value of money and develop good habits. In fact, limiting teens’ funds may force them to be more selective and make wiser financial decisions.

Tips your kids can bank on

Teach your kids about money, and help them develop good saving and spending habits in the following ways.

Allow your children to make some of their own spending decisions. Place reasonable limits. Then offer appropriate guidance while giving your children opportunities to

How to teach your kids about money

learn from their mistakes.

Don’t loan your children money every time they want it. But do offer occasional opportunities for them to learn the costs of borrowing and the experience of repaying the loan. When deciding whether to loan money to your child and how much, consider the following: the purpose of the loan, past repayment, and their ability to repay within a reasonable time.

Charge interest on loans so children learn the cost of borrowing. Realize, regardless of how financially savvy we raise our kids to be, borrowing does have its place. At the very least, it’s often necessary or practical for acquiring a college education, reliable transportation, and a home. These can be wise investments even when borrowing is necessary.

Teach your child how to set financial goals. By the teen years, these may include those big ticket items just mentioned: saving for automobile expenses, college, a home, and other long-range plans. And don’t overlook the importance of short-term goals, which offer your kids a feeling of accomplishment and a boost in self-esteem.


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Require your child to put at least 10% of each paycheck, or allowance, into savings. It’ll be much easier to adhere to as an adult if practiced during childhood and teen years.

Don’t be completely secretive about family finances. Children have few opportunities to see and experience the financial side of the adult world. This doesn’t mean you need, or even should, disclose everything. But it’s easier for kids to understand if they can see it in concrete terms. Develop a detailed household budget. Then explain it so your adolescent can see how your family spends and why.

Discuss the different ways in which you save and invest your own money. Then explain how these different plans work. Point out both the benefits and the risks.

Send your kids to The Mint. They’ll learn about money, goal setting, saving, investing, and more.

Try a computer program such as Family Bank by ParentWare to help your children track their allowances, expenses, loans, and more. This is an excellent way to teach your kids about money. Family Bank calculates interest for both savings and loans; allows children to write checks to their parents; creates graphs of their spending habits; and more.


Kimberly Blaker is a freelance parenting writer. Find out more about her writing services.


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How to Teach Your Kids About Money & Prepare Them for Adulthood
Article Name
How to Teach Your Kids About Money & Prepare Them for Adulthood
Kids who learn and develop good saving habits early in life are more prepared to deal with what lies ahead and develop into financially responsible adults.
Publisher Name
Business Woman Magazine

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