Teaching Children About Saving Money

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As the mom of three and a parent educator, I strongly believe that teaching children about saving money is one of the key life skills we need to teach. Teaching children about money is complex and how to save money is just one aspect. Learning how to save money is much easier if you start early. Using this free printable My Saving Money Chart is a key component of teaching children how to save money in a concrete and understandable way.

Not only am I the mother of three and a parent educator, but I also have a degree in economics from the Wharton School of Business. Yep, I know a bit about money and how to save it.

I’ve been teaching my children about budgeting and saving money since they were four years old. I shared my tips on how to teach financial responsibility for younger children and budgeting for teens. I’m very proud to say that my three children, ages 12 through 19, are doing well at budgeting and saving their money. To achieve that goal it is key to be very purposeful and concrete when teaching children about saving money. 

Teaching Children About Saving Money

Just like riding a bike, children need a lot of support and practice as they learn how to save. Saving is a habit that needs to be nurtured and practiced. Parents need to be deeply involved in the process of learning the habit of saving money. 

Set Guidelines Early

Establish family practices of saving money. Talk about it matter-of-factly and often. We save money. Period. Your children won’t question it if you teach them how to save money from day one.  Saving will be an ingrained habit, philosophy, almost a law of physics. By the time they learn that other people don’t save money, the saving habit will be well established. 

Pay Children in Real Money

Children learn best with concrete objects and lessons. They’ll learn and understand about money sooner and more deeply if you pay them in real money – coins and paper money. I share how we paid our children’s allowances each week to teach them about saving. Paying children in real money is more work (and trips to the ATM or bank) for you, but it’s key to helping your children learn to understand money and how to save it. 

Practice the Savings Habit

Just like learning to ride a bike, you need to help your child practice saving money. Establish routines around saving money. We had a routine every week when we paid our children their allowances. The repetition of that habit helped them understand and internalize the saving habit. We also established a saving habit when they received money from grandparents or for gifts. Half of any monetary gifts immediately went into savings. There was no arguing because it had always been that way. (No one argues about the sun coming up each morning. It just is.)

Help your child set realistic savings goals that they can achieve so they can learn that saving money leads to satisfaction when you achieve your goal. Use the free printable My Saving Money Chart to help your child understand setting a savings goal, working towards the goal, and tracking savings. You can print out additional sheets if you need an extra area to log savings. 

Encourage Success 

Saving money is hard work. Learning to save money is really hard and confusing work. Encourage and praise each small step that your child makes. Encourage them when they get discouraged and help them to see the big picture reward of saving money.

Know When It’s Time to Take Off the Training Wheels

Once your child has demonstrated the ability to save for a goal successfully several times with your assistance, let them practice on their own. It’s just like those times you ran along beside the bicycle without holding on to the back of the seat but really they were doing all the work. Your goal is send them off to adulthood being able to save money successfully all on their own.

Do you have any tips that have worked for you in teaching children about saving money? Keep in mind that learning how to save money is a long-term habit that must be practiced before it is really learned and established.

More Money Saving Ideas

Check out my free printable Best Budget Worksheet for Graduates for when your children are about to become adults and manage their own finances.

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