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How to Teach Children and Teens about Money

Teaching your kids how to save from a young age could help set them up for lifelong financial success.
Two young kids, a boy and a girl, pictured smiling outside

Instilling healthy money habits at a young age with your child or teen will build the foundation for responsible financial decision-making in the future. If you have kids, consider these tips to help teach your young ones the importance of money management – especially saving.


Tip #1: Provide an Allowance

One of the best ways to teach proper money management is by giving your child an allowance. Both the frequency and allowance amount matter less than the actual act of handing over money for the child to control and manage independently. Use the allowance to help teach your child that when they put in the time and work, money is provided in return. Teaching money basics is simpler when the child has real money to learn from and interact with.


Tip #2: Encourage Children to Make Goals

A great way to teach children financial responsibility, particularly saving, is by making goal-centric habits. Make sure you allow them to spend a little so they can directly see the rewards from saving their money for a period of time. We suggest making a savings goal chart to track progress and using stickers or drawings to visually demonstrate the amount of money saved each week. If your child wants to save up for a specific item like a new video game, toy, a bike, or maybe even money to spend on an upcoming family trip, consider adding a picture representing what he or she wants to purchase with the saved funds to serve as motivation. Being able to visually see their goal and their progress will encourage them to save more to reach their goals.


Tip #3: Open a Savings Account

Having their own independent account will encourage your kid to save more money, and it will make them feel more responsible. Head over to any Alltru branch with your kid to open a CUbby savings account. In the CUbby Kids Club, we teach children 12 and under how to have fun while learning how to save money through a reward-based savings club. A monthly trip to the credit union where your child personally deposits their new savings and receives a balance slip is a positive reinforcement that they are growing their account. Plus, we give special prizes for deposits over $10! Your child will begin to get into a habit of saving, which will help them build lifelong financial skills. Since a CUbby account is a real life account, it presents a great opportunity to explain and teach them how they can not only make deposits but also withdraws at the credit union and how we don’t just store your money, we also make you money as well. As an option for teens 13-17 years old, we encourage opening a StepOne Checking or Savings account to put your teen on the path to financial independence as they learn how to manage their own money.

Young Alltru member smiling and being handed a Cubby reward at the Alltru branch in Wentzville

Tip #4: Teach the Power of Patience

Even as adults, sometimes we need to be reminded we must wait to buy the things that we want. As much of a struggle as this can be, we always want to lead by example and be a role model for our kids. Set an example and practice holding off on buying something by making a savings plan that you share with the family. Explain to your children why waiting a little longer for the things you want may help you save and stay within your financial means. Make sure and explain to them that by waiting to purchase something and saving money will help you have enough to cover all of your expenses when you do want to purchase a big-ticket item. Plus, show them how keeping money in an account allows the credit union to pay interest on it.


Tip #5: Encourage Giving

In addition to saving, you may want to teach your children the importance of giving back to others. Suggest setting a certain amount of their allowance aside to a local, not for profit of their choice or to use for gifts to friends or family member. Alltru Credit Union was built upon giving back to our community, and to this day our many employees volunteer their time to give back to local charities and non-profits. We encourage our members to mirror these values and also give back to their community. Encouraging your children to save so that they can experience the joy of getting someone they love a gift for Christmas or a birthday is a joy and a feeling that is very important for them to experience for themselves.

Teaching kids how to save money may seem like a difficult task, but it’s so important in order to become a financially responsible individual. By practicing these tips and instilling money skills in your children from an early age, you can make your child’s understanding of money fun and meaningful. It’s an investment in knowledge, which truly pays the best interest!