Teaching Kids About Money: Why It Matters and How to Do It Right

As a parent, you know the importance of financial literacy. Knowledge about money and how it works is essential to making smart decisions throughout life. But talking about money can feel awkward and uncomfortable, especially with kids. Money can seem like an adult topic, not something that kids need to learn about at a young age.

In fact, many parents are afraid to broach the subject for fear of coming off as preachy or being too "money-obsessed" at such a young age. However, you also understand that teaching your child about money early on will pay great dividends later in life. After all, there’s no better time than now to start their financial education!

Why Teaching Kids About Money Matters

Financial literacy is not just about being fiscally responsible and creating a healthy savings account. It’s about so much more. Financial literacy can lead to improved health, higher self-esteem, and stronger relationships.

How to Have The Money Talk With Your Child

If you’re not sure where to start, there are a few ways to ease into the conversation. Start a Family Treasure Hunt. If your child has an interest in coins, start a family treasure hunt using coins you have collected over time. You can also find online treasure hunts that use coins and bills. This is a great way to bring up the topic of money without coming off as preachy or too intense.

Talk About Everyday Purchases. If your child is old enough to start walking to the grocery store or shopping with you on your errands, start a conversation about everyday purchases. What are they buying? How much are they spending? Why do they need that item?

Teach Your Child the Value of a Dollar

Another way to introduce the topic of money to your child is to talk about how to spend money wisely. You can even make a game out of it. Once a week, give your child a dollar or two and tell them that they get to spend it however they want. This will show your child how to spend money wisely while also allowing them to buy something they want.

It will also show your child that you value their opinion — and that they should value their own opinions as well. You can also help your child understand the value of a dollar by telling them about the "cost of living". What does it cost to rent a home? What does it cost to put food on the table? What does it cost to pay for health insurance?

Help Your Child Build a Financial Toolkit

Kids are sponges, soaking up everything around them. By talking about money and the important role it plays in everyone's life, your child will begin to understand the importance of money in their own lives. You can even help your child build their own financial toolkit. Start a piggy bank. A piggy bank is a great way to help your child begin to understand how money works.

Even young children can understand the concept of saving money by watching how it fills up as they put coins and bills in their piggy bank. Help them come up with a goal. Once they have a piggy bank, help your child set a goal for how much they want to put in their piggy bank. This will help them understand the value and importance of saving money.


As parents, you have a great opportunity to instill good financial habits in your child from an early age. By talking about money and how it works, you can help your child understand the importance of money in their lives and how to make smart decisions with it.

Are you looking for financial education and money apps for kids? Kiddie Kredit is a mobile app designed to educate children on the credit system and track their chores. Download it from the app store today!

Evan Leaphart

Evan Leaphart is the founder and CEO of Kiddie Kredit and the co-founder of Black Men Talk Tech. He creates online curriculums for schools, organizations, and families to teach children about the fundamentals of finance.