I was waiting in line at the grocery store behind a father and his young son. As they got closer, I noticed that the child was eyeing a toy hanging above the register.
Instead of reaching for his wallet, his dad smiled down at his son and asked, “So, son… how much money do you think you’ve saved at home?”
The boy paused for a moment and shook his head. Then something amazing happened. He didn’t burst into tears or throw a tantrum.
Instead, he put his hand in his pocket and showed his father that he had some savings. I couldn’t hear their conversation after that, but I did smile. You see, that interaction wasn’t about a toy.
It was about a parent teaching their child one of the most valuable financial lessons you can learn as a kid: Money is something to save, not just spend.
The problem is that money is a taboo topic we don’t talk about with children until they’re old enough to earn it.
By then, it may be too late. Countless young adults start their first jobs and become entitled spenders because bad money habits have formed by that point.
The younger your kids learn about money, the better decisions they’ll learn to make with their finances later in life.
You don’t need to spend money on worksheets or lesson plans. If you want to teach your children to save money, simply follow these simple money tips, guide them along the way, and you’ll build a strong foundation that they can use for the rest of their lives.
6 Simple Tips to Teach Your Kids to Save Money From a Young Age
1. Start Teaching Them About Money Early
While you may think your toddler is too young to understand money, they actually learn from you before they can read numbers or understand complex financial terms.
Openly discussing the fact that you’re comparing prices at the store or watching you save up for a big ticket purchase plants the seed early on.
When they’re older, those lessons will grow into an understanding of how money works.
Use simple terms they can understand. Focus on earning, saving, spending, and giving. Help them learn that money is earned by working and should be spent wisely.
Your children don’t need to know about investment returns or interest rates when they’re six.
The sooner you start teaching your kids about money, the easier financial literacy will be for them in the future.
Rather than viewing money as this magical tool you can use to get whatever you want, they’ll learn it’s something you have to be responsible with.
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2. Give Them Their Own Savings Jar or Piggy Bank
The tangible nature of physical money makes it easy for kids to learn when you can show them. A glass savings jar or piggy bank lets them watch their money grow.
Instead of forcing them to save when they’d rather spend it, placing a few dollars in their savings every time they get money is fun.
From birthdays to holidays to allowances, teach them to stash away a few bucks whenever they get money.
It may take weeks or even months before they have enough to buy something they want, but seeing their savings grow teaches patience better than you can.
When they’re old enough, you can even get multiple jars and label them “save,” “spend,” and “give.” They’ll quickly learn that money can be used for more than one purpose, and saving should always be an option.
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3. Help Them Save for What They Want
Kids are more likely to save if they’re working toward a goal. Instead of saving because you say it’s good to save money…
Challenge them to save for the thing they really want, whether that’s a bike, video game, toy, or fun activity.
Help them determine how much they’ll need to save up and track it together. With each deposit they make toward their goal, they’re one step closer to purchasing it with their own money.
There’s a financial lesson hidden in that goal saving strategy.
Waiting pays off. Teaching your kids delayed gratification at an early age will help them in more ways than money.
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4. Give Them Opportunities to Earn
There’s no better way to help your kids understand the value of a dollar than letting them earn it.
Household chores shouldn’t always be rewarded with money. After all, they live there too. But every once in a while, allow them to earn money by doing something outside of their normal chores.
Whether they wash the car, clean out the garage, help in the garden, or do some light yard work, earning money can teach kids that dollars don’t grow on trees.
When you pay your children for doing these jobs, they’ll learn money is earned through hard work. As a result, they’ll think twice about spending it because they know what it takes to earn more.
5. Be a Good Financial Example
Your children will learn more from what you do than from what you say. If they constantly see impulsive spending, unnecessary debt, or poor financial decisions, they may eventually adopt the same habits.
On the other hand, when they see you creating a budget, saving toward goals, avoiding unnecessary purchases, and discussing financial decisions calmly, you’re giving them real life lessons every day.
You don’t need to be wealthy to teach your children good money habits. Consistency, honesty, and responsible decision making are far more influential than a large income. Building strong money management skills starts at home.
6. Celebrate Saving, Not Just Spending
Many children receive praise when they buy something new, but saving deserves recognition too. Celebrate milestones when your child reaches a savings goal, resists an impulse purchase, or demonstrates patience while working toward something important.
This doesn’t mean rewarding every dollar they save with another purchase. Instead, acknowledge their discipline and remind them how their smart choices helped them reach their goal. Positive reinforcement encourages them to continue making wise financial decisions.
Over time, your child will begin associating saving with achievement rather than sacrifice. That’s a mindset that can benefit them throughout adulthood and help them build long term financial responsibility.
Conclusion
Don’t think of this as a way to raise millionaire kids. Think of it as a way to help your kids make better financial decisions with the money they earn.
If they learn to spend now and think later as a kid, they’ll spend now and think later when they’re an adult.
By teaching your kids to save money from a young age, you’re arming them with skills that will help them well into their golden years.
Frequently Asked Questions
At what age should children start learning about saving money?
Children can begin learning simple money concepts as early as four or five years old. Lessons should become more detailed as they grow and develop a better understanding of numbers and responsibility.
Should kids receive an allowance?
An allowance can be a useful teaching tool when it’s paired with lessons about budgeting, saving, and responsible spending. The goal is to teach financial responsibility rather than simply giving money.
How much should my child save?
A simple guideline is encouraging your child to save at least a portion of any money they receive. Even saving 20% helps build the habit of putting money aside before spending.
What if my child spends all their money immediately?
Resist the urge to replace what they spent. Allow them to experience the natural consequence of having no money left. These moments often become valuable learning experiences.
How can I make saving money fun for my child?
Use visual savings trackers, clear savings jars, small milestones, and exciting savings goals. When children can see their progress and understand what they’re working toward, saving becomes much more enjoyable.
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