3 Ways to Raise Money-Smart Kids

Young adults face an important challenge in learning to plan for their financial future. From the first time you provide their allowance to spend, you are guiding your child in how to understand money and the importance it will have in their lives. Being transparent with your child about how and why you spend money as a family with help influence their personal decision-making, too.


Discuss the cost of basic needs with your child. What does it cost to pay for essential services, food and clothing for your family? What costs are the same each month and which costs can stress the budget?

  • Will there be extra family to feed during the holidays? Involve kids in shopping the advertised specials to help the family have a wonderful meal at a reasonable cost.

  • Changing seasons most likely will result in higher heating costs. Enlist the family to work together finding ways to lower the electric/gas bill.


Help your child understand the importance of planning for and saving for big-ticket items. For example, setting a goal to upgrade the family’s computer or TV is an opportunity to show kids what goes into saving for big purchases.

  • Discuss setting priorities and the trade-offs the family must make to afford this purchase.

  • Involve your children in researching products to compare quality and prices.

  • How will the purchase be financed? Will there be interest paid over a period of time? Talk about the added costs of loans or credit card purchases with your child.


Purchasing a car requires many considerations. Share with your kids what you are thinking as you identify your priorities for a vehicle. Soon they will be purchasing their first car and they will remember what they learned from this family decision.

  • Will we buy a new car or a used car?

  • Will we make a down payment?

  • How will monthly payments be calculated? How long until it’s paid off?

  • What will the interest rate be? If you are entitled to a lower interest rate because of your good credit score, share that fact with your kids.

Understanding basic money management skills such as living within a budget and handling credit and debt are very important for kids to learn. Family finance discussions provide skills they need to become money-smart kids.


Ellen Mooney is a retired principal and teacher with more than 45 years of experience in K-12 education.

#parents #moneymatters

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