Why it's important to teach children about money?

Published: 06 Mar 2025

Teaching kids about money helps them make smart financial choices in the future. It covers everything from earning, budgeting, saving, and investing to protecting themselves, their assets, and their families. While it's never too late to become a money maestro, starting the conversation early gives your kids the golden knowledge they need to make smart financial choices in the future.

There are several reasons why money skills matter:

• Empowerment: They give people the confidence to make informed decisions, contributing to financial stability and independence. 

• Avoiding Debt: Understanding basic money management principles helps prevent falling into the debt trap and allows better management of what they may already owe. 

• Planning for the Future: They enable better planning for long-term goals such as saving for college, buying your first car, buying a home, or retirement. 

What money skills should we teach our children?

Teaching kids about money involves passing on these essential skills:

• Budgeting: Helping them learn how to create a budget and understand the difference between needs and wants. I need a phone, I want the latest iPhone. 

• Saving: Emphasising the importance of saving money for future needs or emergencies. 

• Investing: Introducing basic investing concepts and explaining how it can grow their wealth over time. 

• Understanding Credit: Teaching how credit works, the importance of having a good credit score, and the potential risks associated with debt. 

• Understanding Insurance: Helping kids understand the importance of insurance ensures they know the importance of protecting themselves and their assets. 

• Spending Wisely: Encouraging them to make informed spending decisions and understand the value of money. 

How can we help kids to be good with money?

There are plenty of fun and effective ways to teach children about money:

• Lead by Example: Children often pick up habits from their parents, so it's important to model good financial practices in daily life. 

• Use Real-Life Situations: Involve kids in everyday financial choices, whether that's planning a family budget, planning the family holiday, or shopping for groceries. 

• Allowance and Chores: Giving an allowance for chores can help them learn about earning, saving, and spending wisely. 

• Books, resources, and games: Use age-appropriate books and online resources designed to teach kids about finances. Games like Monopoly and Game of Life are also great for teaching younger kids about money while having fun as a family.

• Open Discussions: Discuss money, its value, and how to manage it sensibly. 

By teaching age-appropriate lessons about money from an early age, we're giving our children the tools they need to navigate the financial world and help them grow into responsible and independent adults. 

Read our toddlers to teens: age-appropriate ways to talk to kids about money.

Watch our short video to hear girls tackling finance.

Please enable your browser JavaScript to view the video

Transcript  for video Girls tackling finance

Mum: What do you think money is for?

 

Child: To buy stuff,

 

Child: buying vegetables and foods.

 

Child: money is for all the essentials. Like a house, a dog

 

Child: buying stuff, like food.

 

Child: But obviously spending, but like also like, probably saving and investing so you can grow your money more. That's what my Mum would say.

 

 

 

Mum: If you got €1 million now, what would you do with this?

 

Child: I’d get a butler.

 

Mum: Very exciting. Anything else?

 

Child: A chauffeur.

 

Mum: OK. And anything else?

 

Child: My very own castle.

 

Child:  I'd buy house next to Taylor Swift

 

Mum: with €1 million, right.

 

Child: Give half of it to load of difficulty charities, and then spend it all on makeup.

 

Child: Maybe we can do an extension on our House and my dad could have a man cave.

 

Child: I would save it in my bank.

 

Mum: Yeah, good girl. And would you do anything else with it?

 

Child: I’d go to Marbella with it.

 

Mum: You’d go to Marbella.

 

 

 

Mum: How much you think a car costs?

 

Child: $300

 

Mum: Dollars!

 

Child: €90,000.

 

Child: €13

 

Child: A million euro

 

Child: €1000

 

Child: €900

 

Child: €50, or 78,

 

Child: a Lamborghini or something like €200,000 or something.

 

Child: A Lamborghini is €100 to 200 grand,

 

Child: €600,000.

 

Mum: Like what are we talking here?

 

Child: I don't know a Lamborghini.

 

Mum: What kind of car would you be getting for €200,000?

 

Child: A Volvo

 

 

 

Mum: How much do you think a house would cost?

 

Child: €1,064

 

Child:  €100

 

Mum:  I think a little bit more than that,

 

Child: €102

 

Child: at least a million. Yeah. For with one with the Lamborghini.

 

 

 

Mum: Is Mummy good with money?

 

Child: You save and then you spend it all OK? Pennies, except for when she spends it on.

 

Child: She spends it all.

 

Mum: What do I spend it on?

 

Child:  Makeup and tan.

 

 

 

Mum: What does a loan mean?

 

Child: I don’t know.

 

Child: You ask the bank for money and in a period of time you would have to pay it back. That came out of Animal Crossing.

 

Child: it’s money you take from the bank.

 

Mum: It’s money you take from the bank.

 

Child: It's also lunch in Irish.

 

 

 

 

 

Mum: What’s a credit card?

 

Child: During COVID it would be like you would get like germs from the money because money's passed around. So then they invented credit cards. So you can like just press. So it's like all the money is on a little card.

 

Mum: Is the bank giving me money just to have it on credit card?