Money Management for Kids
Understanding the value and earning of money is an important skill set for younger children and young adults to learn. From piggy bank to savings account to debit cards, teaching kids about money helps them become responsible & confident adults. In this guide, we share tips on money management for kids!
Ready to learn about money management skills? Let’s dive in!
Why Money Management for Kids?
Money management for kids is one of the most important life skills. It’s also much more than just knowing how to save money! It also involves budgeting, spending, investing, and overseeing it.
Having a solid financial education can provide so many real-world benefits. From young children to college students to even older adults, any age group can benefit from financial literacy. This is the knowledge necessary to make important financial decisions.
If you start at an early age, it’s much easier to build great financial habits that can help you succeed in your life. Whether you want to go on vacation, attend a new school, or buy a home, sound money habits with your own money can go a long way!
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Money management can provide lifelong lessons via part-time jobs, bank accounts, savings goals, and tutoring/online classes. With the proper knowledge, guidance, and hard work, you can learn to be money smart at a young age and reach your financial goals much more easily.
Best Money Management Tips for Kids
Whether you’re super young or 18 years old, have extra money (and do not know what to do with it), or want to know how a credit card works, the following tips can boost your ability to navigate financial decisions with confidence!
1. Start with Physical Currency (and Banks)
Physical currency consists of coins and paper bills. Putting coins in a piggy bank, for example, helps you to the basics of money management through money handling. Older kids with allowances (ages 9-12) can begin to use savings accounts. As for high school students, they can learn about representational currency by acquiring a debit card.
2. Learn About Allowance
An allowance is an amount of money given regularly for a specific purpose. For kids, this can be for a variety of household chores (including laundry, lawn mowing, and pet care). The specifics are up to each family. Remember that an allowance isn’t only earning money to spend. It can also teach you valuable lessons about saving and sharing (more on that later).
3. Set Savings Goals (and Save Money)
Saving just to save is a good habit, but it’s easier to understand and do if it’s attached to goals. For instance, is there a toy or video game you want? You can find out the cost of the item and then save accordingly! This comes down to understanding how much money you can save in a week (minus standard expenses) and how long it will take to save enough to buy the item.
4. Choose How to Save Your Money
We touched on a few ways to save money earlier. One of the best ways as a younger kid is with the assistance of a piggy bank. This is a great way to stash coins and bills! For tweens, a savings account can help them earn interest and learn about banking. As for teenagers, they might have a job and be ready to get a debit card that’s attached to checking and savings accounts.
5. Understand How to Comparison Shop
Whether you’re in elementary school or high school, comparison shopping is super handy! One way of learning it is by going to the grocery store or apparel shop with a parent or guardian. Making a shopping list, checking websites for discounts or sales, and comparing different brands helps you get the most with your money!
6. Track Spending
Knowing exactly how much you’re spending is a super important component of money management. This helps you become a better saver, too. Do you get an allowance? If so, keep track of your expenses and then add them up at the end of each week. It might be surprising how much you spend. The practice can help you make smarter money moves!
7. Learn How to Earn Extra Money
This isn’t just for teenagers that can drive! If you’re a tween or middle schooler, you’re probably old enough to earn some extra money. There are several ways you can do this. These include babysitting, doing yard work, organizing a sale (like a lemonade stand), dog walking or pet sitting, and tutoring fellow students that need a little academic boost!
8. Learn About Credit (Age Appropriate)
If you’re a young child, then it might not be time to learn about credit. As you get older, however, learning how credit works is a great learning opportunity! Credit is essentially the ability to borrow funds with understanding that you’ll pay it back later. An older kid, for example, could borrow money from a parent and pay it back with interest (which is a charge for borrowing the funds).
9. Learn from Your Mistakes
If you’re a kid, it’s perfectly natural to make mistakes. Hey, even adults make errors! The same goes for when you’re learning money management. Remember to be kind to yourself. Instead of viewing a spending, saving, or investing mistake as an unforgivable action, think of it as a teachable moment. This will help you learn and grow!
10. Understand the Importance of Giving
Managing money can provide a lot of benefits for yourself. But what about other people? If you’re in the position to give to the less fortunate, then it can go a long way! Consider the charities to which you could donate your extra money. For instance, if you love animals, you could give a donation or even help a local animal shelter to raise money. It feels great to give back!
Money Management Resources for Kids
From short-term to long-term goals, there’s a money management resource for you!
Earn It!: Understanding that it requires money to purchase things is a super important first step for young children to recognize the value and use of money.
Berenstain Bears’ Dollars and Sense: The classic book helps kids (ages 4-7) learn about money and responsibility with the assistance of the Berenstain Bears!
Financial Literacy for Kids: This resource is packed with financial literacy lesson plans and activities on spending, allowance, and overall money responsibility.
The Survival Guide for Money Smarts: Earn, Save, Spend, Give: As a highly engaging yet educational book, it provides a solid foundation of financial literacy.
Economics and Personal Finance Education Resources: This is actually a fantastic resource for teachers and students of all ages regarding economics and personal finance.
How to Turn $100 into $1,000,000: Ideal for ages 10-14, the book provides actionable advice on earning, saving, and growing your money.
Teach Banzai: As a free online financial education platform, it is open to both teachers and students! This platform teaches via life-life scenarios like banking, budgeting, and taxes.
Finance in the Classroom: This is another great resource for instructors and students alike (as well as parents). It’s a great starting point to becoming money smart!
I Want More Pizza: Written by Steve Burkholder, the book gives the gift that keeps on giving! Learn about personal finance and financial literacy with this favorite read.
Final Thoughts: Money Management
Whether you’re in elementary school, middle school, or high school, it’s never too late to learn about proper money management!
Along with the right learning resources, it can be super helpful to work with a trustworthy tutor or mentor to guide you through important financial lessons. From lemonade stands to debit cards to investment accounts, the key to making it stick is learning in an engaging & fun way.
It’s also important, along with knowing the value of money, to understand the importance of giving back to others and your community. If you’re wise with how you earn, spend, save, and invest your money, then you might be in a position to help kids, adults, and others down the road.
From money lessons to math skills to video game development, Juni offers education for the real world. STEAM learning is super easy with our personalized 1:1 instruction. We also offer on-demand courses and bootcamps!
No matter the format, Juni courses are fun & engaging online experiences. Where students learn the skills they need for future careers and hobbies, in subjects that are usually hard to find in traditional classrooms. All taught in a hands-on way that kids love!