15 bright ideas for teaching kids about money

When it comes to kids and finances, don’t wait until they have their first job to teach them how money works and the important role it will play in their lives. Early lessons on budgeting, spending, saving and investing can start as early as preschool and become more complex as kids age. The key to keeping them engaged is to make financial education fun and age appropriate.

“Money is a serious topic, but it probably shouldn’t be taken so seriously,” says Shannon Storch, a Thrivent market director and financial advisor in Frederick, Maryland. “Money is a tool … but kids are not going to learn about it if it’s not fun. So, let’s make money, or the experiences that we have with it, fun.”

From board games and real-world experiences to books and virtual simulations, Storch and other Thrivent financial professionals offer tips and resources for parents to help make financial education fun for kids—no matter their age.

For young kids, it’s all about “keeping it light and interactive,” says Bjorn Larson, director of financial education at Thrivent. “You’re just starting with basic building blocks here. We’re teaching them foundational concepts.”

1. Encourage pretend play. Make-believe shopping scenarios can introduce preschoolers to fundamental financial concepts, such as spending money in exchange for food, services and other items. Storch suggests setting up an ice cream shop or toy store and taking turns role-playing cashier and shopper with pretend dollar bills and coins.

2. Decorate a piggy bank. Piggy banks often represent a child’s first lesson in saving money. Make it an experience they look forward to by having them customize their own piggy bank with stickers, paint and markers, and giving them coins to deposit.

3. Take them shopping. When you grocery shop, seek out stores that have carts for young kids to push. “Give them that responsibility of filling up a cart and shopping on their own and seeing what impact that [has on] money,” says Rebecca Wise, a Thrivent financial associate in Boyertown, Pennsylvania.

4. Read age-appropriate books. Picture books help illustrate financial concepts in a fun way that’s easy for young kids to understand. Wise suggests the book Money, Money, Honey Bunny! by Marilyn Sadler as a great starting point.

As your kids go through elementary school, demonstrate how money plays a role in your family’s everyday life. “You can teach some of your family values through those early conversations,” Larson says. “[Kids] definitely can start to see the tie between money and lifestyle and what’s important to your family.”

5. Consider starting an allowance. An allowance empowers kids to start making their own money decisions. Some parents choose to give a weekly amount based on age, while others pay per chore or other goal, such as reading a certain number of books or getting good grades. “Show them how money can be a tool to try to do other good things in your life,” Storch says.

6. Create three money buckets. Expand on the basic piggy bank concept by helping your children set up three separate “buckets”—share, save, spend—for their money. “By doing the three segments, it’s more purposeful and there’s more thought to it,” Wise says.

7. Let them handle cash when shopping. “What’s really tricky in today’s economy is the fact that we use cards so often for everything,” says Larson. It can be hard for kids to understand the exchange that happens when you tap or swipe. Instead, when your kids want to make a purchase, have them use physical cash. This will help them practice counting and make the concept of spending money more tangible.

8. Take pictures of wish-list items. When kids understand needs versus wants and practice delayed gratification, it can help instill healthy savings habits. Rather than purchasing a new toy for them in the moment, offer to take a picture of the item to add to a future birthday or Christmas wish list. Or help them break down how much allowance they’ll need to save, and for how long, to buy it for themselves.

“Middle school–aged children start to want to understand how money can work for them,” says Storch.

In these tween and early teen years, let your kids take on more financial responsibility and ownership by having them use their own money for some purchases.

9. Encourage an entrepreneurial spirit. Starting a business touches on many financial concepts, from income and expenses to pricing and profit margins. If your children express interest in an entrepreneurial venture, help them explore age-appropriate options like a lemonade or bakery stand, dog walking or babysitting.

10. Consider a kid-friendly debit card. As your children start to make their own money, think about getting them debit cards to help them practice budgeting and digital money management. Larson recommends a kid-friendly app that allows parents to assign chores, automate allowances, track kids’ spending, set controls and more.

11. Play games that teach financial concepts. Board games like Monopoly, The Game of Life, The Price Is Right and Yahtzee help kids organize and sort numbers, start thinking about probabilities and have conversations with family about money, Storch says.

12. Introduce the power of investing. Together with your children, check out the Stock Market Game (stockmarketgame.org), where kids are challenged to maintain and grow a $100,000 virtual portfolio over a simulated three-year period.

“They can start to see the power of saving early and what that can turn into,” Storch says.

Once your children are in high school, “you’re more like a coach, in a sense, than somebody that’s telling your kids what to do,” Larson says. “You’re hopefully seeing the growth of their knowledge and ownership, and they’re already doing some of the things you’ve been talking about and thinking ahead.”

13. Give your kids some financial autonomy. At this stage, your teenagers might have their first part-time jobs. If you haven’t already done so, help them open a bank account and talk to them about budgeting.

“You give your older kids, who are earning money now, freedom to buy more things,” Larson says. “They’re feeling more of the weight of the responsibility, and you’re helping them navigate some of those challenges.” While there might be some mistakes along the way, he notes, these are ideal teachable moments.

14. Use games to practice financial decision-making. To prepare your teens for the many financial decisions they will face once they leave home, you could consider having them play board games or online games that allow them to learn from their own choices.

For example, Payback is a website that walks kids through different college scenarios and demonstrates how to graduate without a ton of student debt. Spent is another financial education game that challenges players to survive on a low-income budget.

The board game CASHFLOW, which could spark additional conversations when you play together, introduces players to investing, money management, cash flow and wealth-building concepts.

15. Challenge them to hit a savings goal. Set your teenagers up for success in college and beyond by encouraging them to save through high school and teaching them about compound interest. “By the age of 18, see if they can save $10,000,” suggests Storch. “If you’re 14 years old, you’ve got four years to get there. That’s $2,500 a year. That sounds like a lot of money, but could you babysit? Could you cut grass? Because $10,000 at age 18 could turn into more than $275,000 at 67, just through compounding interest, using an average 7% rate of return.”

Teaching kids about money is a process, moving from simple activities when they’re young to more complex responsibilities by the time they’re in high school. But by building knowledge each year—and making it fun—you can help set your child up for a bright financial future.

Taylor Hugo is a writer in Colorado.