TLC: Practical Tips for Teaching Kids Financial Responsibility

A little girl holding cash putting coins into a piggy bank
Image via The Lincoln Center for Family and Youth

Although some states (Pennsylvania included) require financial literacy to be taught in public schools, children’s understanding of money largely begins and develops at home.

Parents can help foster financial literacy with the following tips and resources, which can make learning about money fun and set children on a path to achieving their financial goals and building the life they envision.

Here are 5 tips highlighted by the resource links below, to help build financial literacy in younger children:

Introduce the concept of money as a resource. Introduce coins and bills, by giving a small allowance and a piggy bank – or better yet, a “spend” jar, a “save” jar, and a “give” jar.

Set the expectation early that planning and doing these three things are all normal uses of money. These three simple categories will help kids learn the concept of budgeting early on.

Play games that teach money skills: Parents can engage their children in games that teach basic money skills, such as counting coins, sorting money, and making change.

 Model healthy spending, saving, and investing. Through observation, kids learn a lot about money from how their parents speak about and manage their own finances. Share with your children how you spend, save, invest, and give—and do these things together as a family whenever possible. This will make all of these practices normal and instructive for them.

Connect their passions to charitable giving. Raising charitable children who will become generous global citizens requires connecting their passions with their giving plans. Discover what they care about and visit charities (online or in person) that help the causes that matter to them. Get them excited about their ability to make a difference in the world through their contribution of time and financial support.

Encourage children to earn and save: Give children opportunities to earn money through chores, small jobs, or small business endeavors. Doing so will help them see the connection between time and money and encourage them to start thinking about ways they can earn money to save for the things that are important to them. Parents can teach children about the importance of savings by helping them set up a savings or custodial investment account.

Below are some things parents can do to ensure that their children’s financial literacy will continue to mature and expand as they become teenagers and prepare to move out on their own:

  1. Challenge teenagers to stretch themselves to grasp new money and wealth-building concepts, including various types of investments. Also, find opportunities to study and explore with them.
  2. Have ongoing conversations about all financial aspects of life with them including savings goals, financial challenges, budget priorities, etc. As adolescents move through their teen years, they’ll be provided with a number of opportunities to strengthen their financial literacy. Whether it be saving and budgeting for car expenses, filing tax returns from their first job, or exploring student loans, having an experienced adult supporting and walking them through these real-life situations will help them to feel more confident manage money when they’re on their own.
  3. Walk the talk. Continue to model the financial behaviors you’d like to see from your children. This may mean parents need to stretch their own financial literacy at times. By this point, teens will be familiar with the financial decision-making and planning of their parents and will benefit by being brought into the process of family budgeting, investing, and giving.
  4. Any allowance should be basic. Too much allowance for teens will limit their motivation to find ways to earn or save for things they want or need. Instilling self-reliance and independence in them now will give them the confidence to earn, budget, and save for the things they want when they move beyond high school.
  5. Talk to teens about credit and debt. Understanding concepts like credit, debt (good vs bad), interest rates, credit scores, and the differences between credit and debit cards will help them avoid costly mistakes and be better positioned to make sound financial decisions as they begin their financial journey.

Helpful Resources:

The Balance – 7 Best Board Games to Teach Kids About Money

Video – Financial Literacy For Kids in 5 Easy Steps

Video – How to Teach Kids About Money

Video – 5 Tips for Raising Generous & Charitable Kids

Video – Our Rich Journey Junior (Teens)

Article – Nerdwallet: Investing for Kids

About TLC

The Lincoln Center for Family and Youth (TLC) is a social enterprise company serving the Greater Philadelphia Area. Among its five divisions, TLC offers School-based Staffing Solutions, Mobile Coaching and Counseling, and Heather’s Hope: A Center for Victims of Crime. These major programs are united under TLC’s mission to promote positive choices and cultivate meaningful connections through education, counseling, coaching, and consulting. For more information, go to:

About the Author

MaryJo Burchard (Ph.D. in Organizational Leadership) is co-founder and principal of Concord Solutions, a Virginia-based consultancy firm focused on helping leaders and organizations thrive while facing major disruption. Concord Solutions offers consulting, coaching, training, research, and keynote speaking surrounding trauma-informed leadership and assessing and building change readiness, trust, and belonging.

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