Age appropriate ways to teach kids financial literacy

When my daughter was 9, we were shopping at the mall when she spotted the cutest stuffed llama that she just had to have. I thought the price tag was a bit high and convinced her we should do some comparison shopping. We phoned a few stores and found the exact llama for half the price. Now 11, she always checks different websites and stores to compare prices when she wants to buy something.

While I mostly just wanted to save a few bucks that day, I also taught my daughter an important money lesson. Beth Kobliner, author of the New York Times bestseller Make Your Kid a Money Genius (Even If You’re Not), says these everyday situations are the main way kids learn about managing money.

Kobliner says parents are the number one influence on their kids’ money habits. “The learning that happens is mostly through osmosis,” she says, adding that parents should wring as much as they can out of everyday teachable moments like going out to dinner, shopping for new clothes, or visiting the ATM.

Here are some fun, age-appropriate ways to teach children about finances as they grow.

Preschoolers: Play pretend

“Teach your very young kids that you need money to buy things,” says Kobliner. “Pull out some coins and discuss how they feel, what they look like and what they’re worth. Then, go over some essential items your family pays for, such as gasoline, clothes, food and treats. This is also a great time to talk about wants vs. needs.” During playtime, set up a grocery store and have your child go shopping with a set amount of play money to buy food at certain costs. This will help teach how money can only go so far.

The Learning Resources Pretend & Play Teaching Cash Register scans items and reads the prices. It features a scale and coin slot and comes with bills, coins, and a credit card. With addition and subtraction games that increase in difficulty as players advance, it also teaches basic calculator skills and the different values of coins.

For an even more full shopping experience, the Little Tikes Shop 'n Learn Smart Checkout includes a conveyor belt, cash register, scanner, and aisle light. It also has more than 35 scannable foods and accessories, which the checkout names out loud. On-screen counting instructions help kids add up the included coins and bills.

Parents will appreciate that it is easy to assemble and can partially fold to save space. A free downloadable app responds to some of the food items, teaching letters, numbers, colors and fun food facts.

• Get the Pretend & Play Teaching Cash Register at Target for $36.49
• Get the Little Tikes Shop 'n Learn Smart Checkout at Target for $169.99

Ages 5 to 8: Spend, save, share

Another key way to build a solid foundation for good money management is fostering the ability to delay gratification, says Kobliner. “It’s a general concept that most kids are already familiar with: We wait for our turn on the swings or for our birthday each year. This is a key skill for learning to save, because you often need to wait before you’re able to buy something,” she says.

A great way to reinforce lessons about saving is having kids divide their money into spending, saving or sharing buckets, with a certain percentage going into each bucket. This also makes giving to charity a regular part of your child’s life. This is easy to do with the Moonjar Classic Save Spend Share bank. Kids can easily deposit coins or folded bills into each color-coded, acrylic lid. It even comes with a small ledger, where kids can keep track of the money they put in and take out.

Reading is another fun way to get kids this age thinking about good money habits, and The Berenstain Bears' Trouble with Money is a favorite. When the cubs are spending all of their money on nonsense items, Papa Bear wants to teach them to value money and makes them work for it. When the cubs become obsessed with earning and saving, they have to learn how to find balance.

• Get the Moonjar Classic Save Spend Share bank on Amazon for $20.99
• Get The Berenstain Bears’ Trouble with Money at Bookshop for $4.59

Ages 9 to 12: Set up a bank account

This stage is the perfect time to take your child to the bank to open a savings account and talk to them about how banks work. Then they can set a goal and start saving towards it. When my 12-year-old son wanted an upgrade for his video game, he had to figure out how long it would take for him to save for it, based on his allowance. Along the way, he made choices, like whether to buy a chocolate bar or keep the money in order to reach his goal faster.

RoosterMoney makes it easy to teach your kids about spending, saving and budgeting. No actual money is deposited in the app, but it keeps a virtual balance that lets parents keep tabs on what allowance is owed and spent. Kids can split their money between Spend, Save, and Give. Rooster Plus has added features, including letting kids set goals and track progress and allowing parents to assign jobs for a child to earn extra money.

Age 13 and up: Teach them real world money skills

When your teen gets their first paycheck from a summer job, Kobliner recommends going over it in detail, explaining why money is taken out for taxes, and that taxes pay for things like schools, roads, and hospitals. “You can also help your teen set up good savings habits by funneling a portion of each check to a savings account,” she says. Teens can also keep a spending diary for a month to see where their money is going and whether they need to create a budget.

If you need a little help teaching your teens real world money skills, I Want More Pizza covers saving, spending, prioritization, goal setting, compound growth, investing, debt, credit cards, and student loans. The book has been used in classrooms across the country to teach money management and this edition brings those lessons home in an accessible, easy-to-read way. Discussion questions at the end help further teens’ understanding—and generate great family conversations about money.

Get I Want More Pizza at Bookshop for $8.27

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