How to Teach Kids to Save Money

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One of the toughest jobs that a parent must face is teaching their child how to be responsible with money. It’s important to start educating your kids early, so that they can carry those lessons learned into adulthood. After all, being able to save money has no age limit! Here are 10 easy ways to teach your children to manage their money, all the way from toddler to teenager.

Five and Under

Explain where money comes from and what it’s used for

Money doesn’t grow on trees — and it’s important that your child knows that. Reinforce that in order to earn money you have to work hard. Also, show them that everyday items cost money. If they express that they’ve been eyeing a new toy, remind them that it will take a little hard work and some patience before they can bring it home.

Ditch the piggy bank, use a clear jar

The idea of a piggy bank might sound great on paper, but it doesn’t give kids a visual. When you give kids a clear jar to collect their coins, they are actually able to see their money growing over time.

Lead by example

There are always little eyes watching you. That means that if you find yourself splurging frequently or if you and your spouse often argue about money, your kids will eventually notice. Set a good example by being smart and savvy with your own finances.

Open up a college fund

If you plan on helping your kids with the cost of college, you’ll want to start a college fund as early as possible. Set aside a savings account and make deposits regularly. Trust us, your kids will thank you for this later.

Elementary & Middle School

Try the three jar method

To help your kids develop financial discipline, teach them to follow the three jar rule. Each time they receive money, encourage them to set aside equal portions into three separate jars — one for saving, spending and giving. This will help them understand that not all of their money should be spent right away, as well as teach them the importance of charitable giving.

Discuss the idea of allowances

There’s an age-old debate surrounding the idea of allowances. So instead of paying your kids for doing basic household chores, pay them only when they go above and beyond. This will act as an incentive and reminder for your kids to ask for new ways to help out around the house.

Introduce age-appropriate spending and saving apps

Download age-appropriate spending and saving apps for your kids to learn about money management in a fun, digital way.


Encourage them to get their first job

Nothing will teach your child more about the value of money than getting their first job. Once they experience working hard to earn a paycheck, they will really appreciate every penny and more fully grasp the idea of when to save versus spend.

Set up their first debit card

Getting your teen situated with their first debit card will help teach them the entire process of banking: checks, ATMs, withdrawals and more. With you as a joint account holder, tying a debit card to your child’s checking account will allow them to manage their money while you monitor.

Discuss college costs

Before your teen applies for college, it’s crucial to sit them down and have the talk: how are you going to pay for college? To save money, discuss possibilities of community college, working part-time while in school, applying for financial aid or applying for scholarships.

Starting early can make all the difference when it comes to teaching your children to save. It won’t always be easy, but if you want your children to make smart financial decisions in the future, taking the time now will be worth it! 

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