How to Talk to Your Kids About Money

With kids back in school, we’d like to ask the question: When is the right time to start talking to your kids or grandkids about money? The answer is, if they are old enough to ask for a toy or a bike, they are old enough to start learning financial lessons! Here we share EIGHT tips and teachable moments you can use right away:

Teachable Moment #1: At the Bank

When you go to the bank, bring your children with you and show them how transactions work. Get the manager to explain how the bank operates, how money generates interest and how an ATM works. Ask the manager for a tour—be sure to ask to see the vault.

Teachable Moment #2: On payday

Discuss how your pay is budgeted to pay for housing, food and clothing, and how a portion is saved for future expenses such as college tuition and retirement.

Teachable Moment #3: Supermarket

At the grocery store, it’s easy to give clear examples of “needs” and “wants” using different kinds of foods at a grocery store. Milk (for strong bones) is a need; juice or soft drinks are a want. Explain the benefits of comparison shopping, coupons and store brands.

Teachable Moment #4: Chores and allowances

Assign chores and give them a monetary value. Discuss ways to budget and divide allowances. Encourage children to set a financial goal, such as saving for a bike, and figure out how to achieve it.

Teachable Moment #5: Paying bills

Explain the many ways that bills can be paid: over the phone, paper or by check, electronic check or online check draft. Discuss how each method of bill pay takes money out of your account. Be sure to cover late penalties, emphasizing the importance of paying bills on time.

Teachable Moment #6: Using credit cards

Explain that credit cards are a loan and need to be repaid. Share how each month a credit card statement comes in the mail with a bill.

Teachable Moment #7: Browsing the Internet

While online, explain to your children how valuable their personal information and privacy is to you, to them, and to online predators. Discuss the risks and benefits of sharing certain information. Then, as a family, make a list of rules for keeping personal information safe online.

Teachable Moment #8: Planning a vacation

Whether you are planning an outing to a local amusement park or a once-in-a-lifetime trip, emphasize the value of saving as a family. Set a family savings goal that involves your children. Figure out the cost and discuss ways everyone can help to reach the goal.

Always encourage your children to ask questions about money. If you don’t know the answer, research it together or ask your banker.