How To Teach Children Good Money Habits

Jun 6, 2018 | Finance, Raising Children | 0 comments

In today’s society there is a growing pressure for the next generation to be a people of possessions. When I say a people of possessions I mean that there seems to be a pressure on young ones to constantly be spending money on the latest “thing”. The latest thing could be the newest games console, the latest trainers, designer jeans or even a brand new phone.

Whatever the latest thing is we have rapidly fallen into the trap of becoming a throw away society. We always want what is the latest even if we already have that perfectly functioning mobile phone.

Learning about money

This is the reason why now more that ever it is time to instil some very good money habits into our children so they can appreciate the value of what these things cost.

I don’t know about you but recently I’ve noticed that my children have picked up a habit of wanting all the things that their friends have.

There is nothing wrong with that in itself but I don’t want them to misunderstand the value of what it is that they are asking for.  Everything has a price and nothing comes for free.  This is a really important lesson to learn.

I remember when I was a little girl and all the rage was for these fountain pens where you would buy the ink and refill the pen so you could use it.  It was to coolest thing ever back then.  I remember begging my dad to buy me one, which he did.  I loved it!

It took me exactly 2 days to lose the pen.  I was gutted but I explained my situation and I promptly got another one in replacement.  Guess what?  About a week later I had lost the pen again.

I couldn’t bring myself to confess that I had lost this pen again so I used my savings and secretly purchased the exact same pen again, this time with my own money so no one would notice. I bet you can guess what didn’t happen?  That’s right, that pen stayed with me for years.

I was so careful with it because I had used my own savings to purchase the pen this time around.  This experience sat with me for a very long time and was probably the reason that I am so money conscious today.

If you have young children here are some great ways to get your children to start thinking about money decisions.  I have used these same tactics with my own children.  Remember it’s never too early to start teaching your children about the responsibility of having good money habits.

Teach Your Children Good Money Habits

1. Involve them in your personal money-making decisions


I love this tip because not only does it show your children that you personally have to think before you spend money but it also shows them that you as well as them have to have good money habits.  Let your children see you weigh up the options between one dress and another.

Make them aware that you can’t just buy both but that you only have enough money to buy one.  Let them help you choose which one would be best for you and work through the thought process with them.

2. Let them earn money for doing various things


This is something that we have recently started doing in our home.  As we home school sometimes it can be difficult to keep the children motivated with work so we allow the children to earn money for doing excellent work for the day.  

When we give this money it’s not just a thank you for showing up but rather more a thank you for putting in really good work today.  It creates a sense of achievement for them.

This has worked really well for us because it keeps the children perky during home school and it creates some really good healthy competition between them to do well.  

At the end of the week when the children tally up what they have earned it’s a great joy to them to see what they have accomplished. It allows them to have some understanding of what it took to earn that money leading them to be more careful in their spending.

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3.  Let them make some financial mistakes


In our family we have two extremes when it comes to money.  If my daughter has money she will happily spend some of her money on you as well as 20 bags of sweets if you let her.  My son on the other hand, once he gets his money it goes straight into his money box and doesn’t see the light of day again.

I sometimes wish I could squish the two of them together and get a perfect blend of saving and spending but unfortunately life doesn’t work that way. My daughters generosity is amazing but sometimes she gets carried away and within a day or 2 all her hard-earned money is finished.

I have to let her make this mistake which is really hard for me.  Afterwards we talk about how and why she spent all of her money so quickly so that she can understand that she didn’t use good money habits when spending.  It gets her to think about perhaps what she could do differently next time..

Financial Management

4. Teach them the principles of saving and spending


It’s a good idea to show your children that its ok to spend some money but that you don’t have to spend all in one go.  It’s a great balance if you can get them to learn early on about spending a percentage and saving a percentage of their money.

If you teach your child to save towards something that they really want rather than a bag of sweets that will be gone in 1 hours time you will instill some good money habits in them which will last a lifetime.

5. Let them see that you don’t always have the money


I love to show my children that sometimes I don’t always have the money to buy all the things that I want.  It’s a good idea for children to see that just because you are an adult it doesn’t mean that you can buy anything that you feel like, you have to work and save up for it.

If you can, voice out your financial situation (within reason) to your children so that you can talk through your financial plan together.

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No money

6. Involve them in your grocery shopping and budgeting.


This is a golden nugget for me because I love to shop for bargains and giving my children the chance to do this with me creates a bond between us. It gives them the opportunity to get a good handle on what things cost and if it is indeed worth the price tag.

The other day we went shopping and I bought some ice-cream that had been reduced. The children were completed shocked by how much the original price of the ice-cream was and were very quick to tell me that they didn’t think it was worth the money and “why do people waste their money on things like that?”

I was quickly able to explain to them that it wasn’t necessarily a waste of money but it’s rather about what you can afford.  If I had been saving up for the more expensive ice-cream would it be a waste of money if it was a treat to myself for doing well at something?

No not at all because I am fully aware of what I am doing and it is a treat which is a reward.

Teaching children good money habits is not just about teaching them not to spend money, its much more than that.  It’s about teaching them to spend wisely on things that mean something and have value.


I would love to hear about your experiences in teaching your children good money habits.

Drop me a comment below!

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Good Money Habits for Children | Financial education | Reasons to save money | Learning how to budget #savingmoney #financialhabits #budgeting #savingmoneytips #savingmoneyforteens #savingmoneyideas #moneymanagement #financialorganising
Good Money Habits for Children | Financial education | Reasons to save money | Learning how to budget #savingmoney #financialhabits #budgeting #savingmoneytips #savingmoneyforteens #savingmoneyideas #moneymanagement #financialorganising
Good Money Habits for Children | Financial education | Reasons to save money | Learning how to budget #savingmoney #financialhabits #budgeting #savingmoneytips #savingmoneyforteens #savingmoneyideas #moneymanagement #financialorganising

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