I received a message from a mom this week asking at what age she should start talking to her own kids about money.  Here’s my advice:

The child development experts tell us that a child’s money habits are established by age 13 – so start teaching early – and long before 13!
From birth, you need to “set the stage” and spark your child’s interest in money:
Give the Money Savvy Pig:
At birth, many people give a child a piggy bank as a gift.  Instead of the usual one-slot bank, give them a four-chambered piggy bank (like ours – the Money Savvy Pig) as a visual to see each day and to learn about the 4 choices they have for money – save, spend, donate and invest. 
When your child is old enough, watch where they are putting the money – in what slot – and ask why.  Match funds to incent them to meet the goals they are setting for themselves with the stickers that come along with the Money Savvy Pig.
Read books about money life lessons:
Read age-appropriate books about money to your child.  Here are a few suggestions (most available at Amazon.com):

  • For Pre-Schoolers try The Berenstain Bears’ Trouble with Money,  The Berenstain Bears’ Get the Gimmies or The Berenstain Bears’ Dollars and Sense
  • For Elementary age children some good choices include Alexander, Who Used to Be Rich on Sunday, A Chair for My Mother, The Giving Tree and the Money Savvy Kids Club books
  • For middle schoolers, Project Wheels, The Toothpaste Millionaire, Lawn Boy and One Hen: How One Small Loan Made Difference will introduce ways to earn money and inspire many budding entrepreneurs. 
  • Lastly for high school and college kids, I recommend Welcome to Your Financial Life to help them identify the keys to smart financial decision-making as they start out on their own.  These books will start many a discussion about money and allow you to talk about your values around money.

Watch for a child’s interest to show:
As soon as a child starts to show interest in money, or is interested in owning something, start to talk about what that means in an age-appropriate way.  For example, how will they earn the money to make the purchase?   Many a two-year old child has been known to say “I want this” at the store.  Make this moment a teachable moment by explaining to them what it takes to get what they want.

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Written by Susan Beacham
Susan Beacham founded Money Savvy Generation in 1999 after almost two decades in private banking and investment management complemented by considerable time teaching at the elementary level.

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