Introducing Money to Children

Misty Weaver-Ostinato
Moms Budget

Money, drugs and sex are the hardest things for parents to talk to children about. Yet they are the most important things. As parents we have to put aside our embarrassments, or even lack of knowledge, and begin conversations with our children, even if it means learning right alongside of them. Following are seven easy steps to help you start introducing money concepts to your children.

Start Today

Even if you aren't a great money manager, you don't pay your bills on time, or save enough money for emergencies, you need to start teaching your children today! Not only will it help them avoid the mistakes you have made, it will help you as well! Don't put it off until you have more money or you have your budget under control, the day may never come.

Think About Your Habits

Where did you learn your money management skills? Chances are you weren't taught at home and had very minimal education in the classroom on how to manage money. So where did you learn? Probably from watching your parents, without them even knowing. By being aware of this you can help your child more by being a role model for them.

Start Talking

Keeping communications open with your child will help them develop money skills. Letting them hear you discuss bills, loans, and checking accounts will give them a background on all the roles money plays in our lives. Talk to them about mistakes as well.

The Uses of Money

Teach your children the four uses of money, Spending, Saving, Giving and Investing. This will help children learn other values such as charity and the need to prepare for the future. A good rule of thumb for allocating their money into categories is 10% for Savings, 10% for Giving, 10% for Investing, and the rest for spending.

Keeping Track

Children learn visually, so you may want to create a system that will allow them to see where all their money is going. Cans work very well for children, one can for each use of money. This is a very easy way to divide the money, and they can see exactly how much they have in each category. Introducing them to a checking or savings account is good as well, especially as they get older. Seeing how their money builds and even earns money for them in a savings account is invaluable.

Keep Learning

Your children will make mistakes, and you should watch for lessons that they can learn from those mistakes. You will be able to learn with them as well. This is a great chance to start learning about the stock market together. There are board games and computer games available and plenty of books to dig deeper into the world of saving and investing.

Set Goals

Money is used for goals, whether it's a house, a vacation, or for your child, a bike or game. Help your child set goals, short term goals and long term goals so that they can learn how to save money and practice. A short term goal could be saving for a computer game or concert tickets, and a long term goal on most children's minds today is college or some other form of higher education.

Copyright 2001, provides financial resources for women who happen to be mothers! Visit today at and sign up for our newsletter by sending an e-mail to Misty Weaver-Ostinato

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