From toddlers to teens: Talking to your kids about money

Kids have an uncanny knack for making money disappear. One minute you’re doling out coins for lollipops or a few dollars to buy an ice cream, and the next thing you know your wallet has been emptied out for toys, sneakers, school events, and first cars. If you’ve ever wondered whether your kids think money grows on trees, you’re certainly not alone. Raising kids is expensive, and sometimes it feels like they just don’t realize how much things really cost.

That’s why it’s so important to talk to them from an early age about all aspects of money — earning, budgeting, saving, and investing. Closing the gap in knowledge between the things they may need or want to buy and how to pay for them can set kids up for financial independence down the road. In fact, a 2025 survey found that Americans who grew up with a strong financial education were one and a half  times more likely to have successfully negotiated pay raises during their careers compared to those who didn’t get that early financial education.¹ They also reported practicing better financial habits as adults over the last year.²

Every parent wants their child to flourish, both emotionally and financially. Interestingly, 83% of parents say they wish they’d learned more about money when they were young.³ The good news? Parents are stepping up — nearly twice as many regularly talk to their kids about topics like investing (44%) compared to how often their own parents did (just 24%).⁴

If you’re ready to help your child build a confident financial future, here are some practical tips for teaching them about money, whether they’re just learning to count or ready for their first savings account.

Teaching toddlers about money

Even young children can be introduced to the idea of money through play. Pretend one of you has a store and the other is going shopping. Be sure to include the parts of those experiences that involve money. You can also begin to introduce them to actual money: Show them all the types of coins and have them organize them by like-kind or by size.

Talking money with a preschooler

When your child gets a little older, they’ll be more curious about money and how it works. So be open with them — discuss it when you pay bills or go to the grocery store. Even before an allowance is on the table, encourage your kids to pitch in around the house. A strong work ethic is contagious, and if you’re able to instill this concept now, by the time money comes into the picture, the work part has already been taught. Plus, you can continue to teach money concepts through play.

Providing a financial foundation for young kids

Between the ages of six and eight, children can begin to take on household responsibilities and earn an allowance. This will bring the concept of earning money into their world. Teach them about short- and long-term goals and the importance of saving. Creating jars for different goals, such as saving up for a new bike or having money for the ice cream man, will help make these concepts tangible for them. You could even consider having them earn “interest” on their allowance to teach them about growing their savings.

Make earning an exercise in choice. Look at two of their most frequently purchased items and compare how many hours of chores it would take to buy one or the other. Ask them if they could only have one, which would it be and why? Would they be willing to do more chores to earn enough for both? This also helps kids understand that money is a finite resource and there are always trade-offs and decisions to be made.

Creating interest in finances in older kids

Children between the ages of nine and 12 can understand and grasp complex concepts, so you can talk to them in more detail about setting a budget. Walk them through your family’s starting balance and how each expense deducts from the available amount to show them where the money goes. Things such as Wi-Fi and streaming services are a great way to start a conversation about how paying for intangibles is an important part of budgeting. You can also instill a sense of generosity by showing that a portion of your income goes to a cause you support.

Discussing finances with young teens

Once you have a teenager, it’s helpful to start thinking about what they want to do after high school and the costs and impacts associated with those options. Younger generations tend to prioritize experiences over things; helping them understand the full bottom line of a senior prom or a class trip to Spain is a great opportunity.⁵

Or turn it into an activity. Have your child decide what their ultimate vacation destination would be. Give them a fixed amount, say $4,500. Let them research how much flights would cost for everyone in your family, the average hotel price per night, and any other fixed costs your vacation would have. Now have them see what’s left over for food, fun, and souvenirs (probably not as much as they thought).

As their lives expand and require more funding, include them in the budgeting process and encourage them to look for ways to earn money (mowing lawns, babysitting, etc.). Additionally, this is a good age to talk about credit — how it works, how important it is, and how to build a good score.

Money and older teens

The last stretch has arrived. Many major credit card issuers allow you to add a minor as an authorized user on your credit card. This can let them practice managing a credit card and can help them establish a positive credit line on their report. Make sure to keep talking about money and work with them on managing their own budget. Help them understand the trade-off between what they spend on today and how that affects what they can purchase in the future.

Teach by doing

Remember, actions speak louder than words. Yes, conversations are crucial, but to really show your kids how to become confident with money, model the behavior you want to see them embrace.

If these habits aren’t already a part of your financial life, try to add them, and don’t be afraid to talk to your children about the process.

Money doesn’t have to be a taboo topic with your kids. No matter how old they are, it’s the right time to talk about it. This will help prepare them for the real world, so when they do go out on their own, they know exactly what to do.