Money habits start early—sometimes earlier than we think. But teaching kids about money doesn’t have to be boring or complicated. Parents often ask me the same few questions when it comes to raising money-smart kids. Here are my top three, with quick tips you can use right away.
Q1: What’s the right age to start teaching my child about money?
A: Start early—preschoolers engage with the world through pretend play and mirroring what they see. This is the perfect time to introduce pretend money, set up play stores, and model everyday money habits. As kids enter Kindergarten and early elementary school, they begin to understand quantities, compare prices, and grasp simple decision-making. This is when habits start to form—how they choose, what they value, and whether they save or spend. The goal isn’t perfection—it’s practice and positive exposure.
Q2: Should I give my child an allowance?
A: Every family is different, so do what feels right for yours. That said, introducing the idea of earning money at a young age can be powerful. Kids don’t always see how adults make money—so talk about the jobs people do when you’re out and about (like baristas, bus drivers, or small business owners). Then, coach your child to find simple ways to earn—like offering helpful chores to you, grandparents, or neighbors. You can also encourage them to sell things they make or grow.
Q3: How do I teach my kid to save money instead of spending it all?
A: Keep it visual and tangible. Cash is key—kids can see it, hold it, and understand what it represents (like an hour of doing chores). Once they earn money, help them divide it into simple categories using jars, envelopes, or labeled pouches. Start with three:
● Personal Fund – money they can spend now.
● Savings – for something bigger they really want (like a bike or vacation money).
● Donation – for a cause they care about (like the local cat shelter or food bank).
As they grow, add more envelopes: a long-term savings fund for big goals like a car or college (deposited into a bank monthly or quarterly), and a business fund for any kid-run ventures like lemonade stands or dog walking. This approach builds real budgeting skills in a way that’s fun, hands-on, and confidence-building.
Mara Williams is a business coach with Success Street Coaching and the author of The Little Books of Big Business.
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