Most parents want their kids to grow up to be financially secure but you might find it challenging to start conversations about money that can give them a solid foundation for future success. For example, a 2020 T. Rowe Price survey indicated that 41% of parents experience some anxiety discussing financial matters with their kids.

Worst case scenario is that fear or the unknown prevents parents from talking about money with their kids. The 2024 Her Money Mindset survey from Investope𝔍dia and REAL SIMPLE found that 20% of parent respondents didn't discuss moneꦉy with their kids at all. 

Good news: You don't have to be a money expert to teach your children invaluable lessons about personal finance. Here's what you should know about approaching these conversations, based on how old the child is.

Why Talking About Money With Kids Matters

You might think that your child is too young to talk about money but kids pick up cues about it and what it can buy from the world around them. Young children are already influenced from seeing ads on TV and online to hearing peers talk about vacations and toys. These influences shape their tastes and they'll inform their perceptions of money later in life. 

"Children will learn about money from watching and listening to their parents, whether their parents talk to them about money or not," says Jen Mayer, an accredited financial counselor and🔴 co-founder of . Mayer indicates that talking openly about money and how it's earned, managed, and saved can help kids understa💃nd that resources are limited. 

You prepare them to manage their finances independently later when you get kids involved with hands-on money lessons early. Young people who enter adulthood lacking basic financial literacy are vulnerable to money struggles and get-rich-quick-schemes.

Age-Appropriate Money Conversations Start Young

The Her Money Mindset Survey from Investopedia and Real Simple found that most parents feel their children should learn about money when they're seven to 10 years old. Most women who said they don't talk to their kids about money indicated that it's because their children are too young.

Developmental research shows that children start to form emotional reactions to spending and saving money as early as five years old, however. These attitudes translated to real-life spending behaviors later in life, too.

Early les🀅sons can sink in and sharing age-appropriate money details with your kids can make them feel included and respected. They see you model transparency, trustworthiness, and respons🌼ibility.

A preschooler will grasp very different money concepts than a high schooler, however. , a board-certif🧸ied clinical psychologist and certified financial t🦄herapist, indicates that you should anticipate that your kids might not immediately understand or engage with the topics you're presenting. 

Don't feel that you've failed if your kids don't want to engage in financial discussions right away. Williams says, "Your child may not seem to care when you first start trying to have money conversations and that's OK. At their age, money isn't a priority for them. Continue to share information as the opportunity arises and try to make it relevant to them and their interests." 

Ages 3 to 5: Play Money

The preschool crowd i꧒s still building basic cognitive skills so keep money talks brief but frequent. Weave them into playtime꧟, daily routines, and hands-on activities.

"Preschoolers can help you count your change and begin learning the denominations of our currency. Play at an imaginary store or restaurant with your toddler or preschooler to demonstrate the process of paying for items," says Williams. "As your child gets older, you can explain how you use money, using trips outside the home as learning opportunities." 

Older preschoolers can read the tot♏al at the checkout counter, h🧔elp you pay the cashier, and count the change. These activities can help them understand the basic concept of exchanging money in return for goods and services.

Once kids have grasped these foundational ideas, Mayer says they can benefit from learning to categorize their money after they've grasped these foundational ideas. They can learn that not all the money they receive goes toward spending. 

"The three-category system of 'spend, save, give' is a good foundation to help kids learn how to be intentional about their money and teach the habit of saving from an early age," Mayer explains.

Ages 6 to 10: Allowance Time

Three-quarters of parent respondents to Real Simple and Investopedia's survey said that children should learn about money during this time, beginning at about age seven. Introducing an allowance is one way to start imparting practical money lessons. You can use it to help them set age-appropriate savings goals like a new toy, a gift for someone, or a donation to a cause. Guide them through the process of planning and budgeting.

Williams advises leaning on everyday activities as low-stakes opportunities to introduce money talks. Teach children to co෴mpare the prices of products at the grocery store, not just by looking at the stickers but 𓂃also at sizes. Kids know enough about math to participate fully in budgeting decisions, coupon clipping, and in-store shopping on the older end of this age range.

Williams says you can also draw out your kids' motivations by creating a family project around saving for a particular goal like a special outing or an item the whole family will enjoy. Otherwise try embedding the same lessons by doing a deep dive into the value of money around fundraisers for their class, scouts, or religious groups. 

Ages 11 to 13: Balancing Wants and Needs

Kids start weighing their interests and they gain an understanding of smart shopping choices in the tween years. Have them compare features,🌱 prices, and quality to determine if the value matches the cost when they request the latest toy or electronics. Help them craft a savings plan and teach them how to shop around for deals online and in-store if they have an allowance.

This is also a perfect time to make them responsible for moni🐈toring their bank account balances. Doing so can help them make better use of gift-giving seasons. Do they want their grandparent to send toys or would they prefer a deposit into their accounts so they can pay for a summer camp or meet a savings goal? Kids can grasp value at thi꧋s age and this makes it a great time to help them establish a sound compass around what matters most to them.

Ages 14 to 18: Hands-on Practice

Parents have a responsibility to equip teens with independent money management skills. This is an impressionable time in their lives and the lessons learned during this phase can be particularly long-lasting. Older teens will begin to get offers for college, jobs, and credit cards, all of w꧂hich will impact their finances ꦯfor the rest of their lives.  

Williams says that now is the time to model good money habits. Your kids observe more than you realize so how you spend your money matters just as much as how you talk about money. Try reading some college savings and career planning books together and discussing whether the tips and theories resonate with them. Personal finance isn't one size fits all. 

Teens will also benefit from discussions around the emotional aspects of spending and saving. This is a time when the𓂃y will call you out on your money missteps. It helps them establish their money scripts and stories, as differentiated from the ones they inherited from you. 

Incorporate Money Into Everyday Conversations 

Try teaching real-life money skills on the fly if formal sit-downs to talk finances don't fly with you or your kids.

• Big milestones: Help kids understand that paying for a new car, house, or college degree takes years of forethought. It's easy enough to get them involved in saving but you also want to teach them about debt. Most of these items are purchased with loans so seize the opportunity to talk about interest rates, repayment terms, and inflation. Milestone purchases take time to decide so you can stretch the lessons out over weeks or months.
• Online shopping: Let kids research prices for similar items across websites. Help them evaluate taxes, shipping or pick-up costs, warranties, and return policies. Now's a good time to chat about internet safety and keeping credit and debit card numbers safe from identity theft.
• Stores: Let each kid select a few items on the list within a set budget then have them find and calculate the total cost of their items with tax. 
• Trips: Traveling to other countries is enriching because it lets kids compare cultures and learn new practices. Teach kids about different currencies if you take an international vacation. Let them calculate how much their favorite foods or toys cost in this new place. Help them understand the basics of trade and imports and exports and why some things are priced higher or lower in different parts of the world.

How to Overcome Common Roadblocks

Money talks can get tricky even when you have the best of intentions. There's no need to be perfect or to know it all. Just showing kids how you overcome money challenges builds empathy and resilience. 

Don't Rely on School

Schools teach some money basics but most don't dig deep into all the money topics kids will face in adulthood. Only 26 U.S. states had some sort of formal financial literacy education requirements in place or in progress for high school students in 2024. Real-life financial decisions boil down to accounting and statistics so it's surprising that both topics get short shrift in schools. Money habits have to come from home and you're going to be your kids' most important teacher. 

It's Not Too Late 

Any age is the right age to start money talks. Use everyday spending moments to weave in quick lessons. Keep the conversation going by comparing old prices to new ones and constantly questioning 澳洲幸运5官方开奖结果体彩网:if purchases are worth it. 

It's never too late to start talking about money with your kids even if they're adults. Parents often avoid topics like their own 澳洲幸运5官方开奖结果体彩网:retirement, long-term care, and inheri💦tance plans and these directly 𒁃affect their adult kids. Try talking with them about your life plans and how you intend to fund them.

Managing Money Is a Team Sport

There can be so much shame around money that many people only talk about it in hushed tones. It's easy to think that each individual is the sole person responsible for their money successes or failures but that's not true. Money is often managed in concert with others with whom your child might not be familiar.

Managing money means juggling a lo🔜t more than just your personal spending and saving habits. Talk with kids about the entire ecosystem around money so they know how to get help when and if they need it.

The Bottom Line

You don't have to be a money expert to teach your children about the value of a dollar. Learn along with your child. Teach them how to make sound financial decisions and point them in the direction of credible resources that can support every part of their financial lives.