Teaching Kids About Money Before They Have Any

Most kids learn about money the hard way—by making expensive mistakes when the stakes are high. A better approach: teach them while the numbers are small.

Here’s how to create a money journey for your child, broken into checkpoints they can actually achieve.

Start with understanding

Before kids can manage money, they need to understand what it is. This isn’t as obvious as it sounds—digital payments have made money invisible to many children.

Checkpoint ideas:

• Count physical coins and bills
• Understand that things cost different amounts
• Know that money is exchanged for goods/services

Move to earning

Once they understand money exists, help them see how it’s created through work and value.

Checkpoint ideas:

• Complete a task for payment (beyond regular chores)
• Understand that different work pays differently
• Save up for something specific

Introduce choices

This is where real learning happens. When kids have their own money and must choose how to spend it, lessons stick.

Checkpoint ideas:

• Make a purchase with their own money
• Experience buyer’s remorse (yes, this is valuable)
• Save for a larger goal over time

Build habits

Finally, move from occasional lessons to regular practices.

Checkpoint ideas:

• Maintain a simple budget
• Understand interest (earning and paying)
• Give to a cause they care about

The key is progression. Each checkpoint builds on the last. By the time they’re handling real money as adults, they’ve already made the mistakes—with smaller amounts.

Money management is one of 50 essential skills your child needs before they leave home. See what’s age-appropriate for your 5-year-old, 10-year-old, or 15-year-old.