Teaching Kids about Money

Shaping solid financial habits in youngsters isn’t just about numbers.

It’s a crucial part of their education that equips them with skills that will serve them well into adulthood. We’ve listed some simple ways that you can involve kids in the learning process and build a foundation for financial responsibility.

Lead by Example
As we know, children pick up a lot of habits by observing the behaviour of the adults around them (some we really wish they wouldn’t!). You can demonstrate responsible spending habits by avoiding impulse purchases, paying bills on time and saving. Don’t hesitate to share stories of your own experiences with money, both successes and challenges, as this provides transparency and real-world context.

Play Money Games
Engaging in educational games centered around money can making the learning process fun for children. Board games like Monopoly or The Game of Life that simulate financial scenarios can teach them valuable lessons about budgeting, investing, and making strategic financial decisions.

Encourage Saving
Piggy banks are a great way for children to learn the importance of saving, and although money is becoming increasingly virtual, having physical coins and notes can help them see their money as it grows. Assisting them to set saving goals for a new toy or experience they’d like also teaches patience and discipline to achieve what they set their minds to.

Involve them in Budgeting
As children get older, involving them in family budget discussions can provide them with insights into financial responsibility. Sharing age-appropriate information about income, expenses, and the importance of budgeting, can allow them to contribute ideas on cost-cutting measures or ways to allocate funds for an upcoming family holiday or house project. This involvement not only educates them about financial planning but also instils a sense of ownership and responsibility.

Open a Kids Bank Account
Many banks offer special savings accounts designed for children. Opening an account in their name, with their involvement, can be an exciting step toward financial independence. Teach them how to monitor their account balance, understand statements, and set savings goals. Some banks even offer rewards or incentives for regular savings deposits, reinforcing positive financial habits.

Teach the power of giving back
Encouraging children to allocate a portion of their money to charity helps foster empathy, generosity and a sense of social responsibility. Discuss the impact their contributions can make towards helping those in need or supporting a cause they’re passionate about.

Teaching kids about money early can help them to navigate the complex financial landscape with confidence. By starting simple, incorporating practical experiences and leading by example, parents can assist in shaping their children’s financial values and behaviours.

Have more questions? Reach out to our knowledgeable team today.

We acknowledge the significant contribution of Dr Ron Bewley and Woodhall Investment Research Pty Ltd in the preparation of this report.

General Advice Warning
The information in this presentation contains general advice only, that is, advice which does not take into account your needs, objectives or financial situation. You need to consider the appropriateness of that general advice in light of your personal circumstances before acting on the advice. You should obtain and consider the Product Disclosure Statement for any product discussed before making a decision to acquire that product. You should obtain financial advice that addresses your specific needs and situation before making investment decisions. While every care has been taken in the preparation of this information, Infocus Securities Australia Pty Ltd (Infocus) does not guarantee the accuracy or completeness of the information. Infocus does not guarantee any particular outcome or future performance. Infocus is a registered tax (financial) adviser. Any tax advice in this presentation is incidental to the financial advice in it.  Taxation information is based on our interpretation of the relevant laws as at 1 July 2020. You should seek specialist advice from a tax professional to confirm the impact of this advice on your overall tax position. Any case studies included are hypothetical, for illustration purposes only and are not based on actual returns.