9 Creative Ways to Teach Your Kids How to Save Money

9 Creative Ways to Teach Your Kids How to Save Money

9 Creative Ways to Teach Your Kids How to Save Money

Guest Writer: Alexandra Eidens


Saving money is the bedrock of financial independence. When people know how to save, they have more flexibility and opportunity in their lives. Yet teaching our kids about money is not something that necessarily comes easily for all parents. 

To do it well, we have to work through our own beliefs and habits to show our children what works best.   

Here are 9 things to do to help you get started teaching your kids how to save money: 

1. Discuss Wants vs. Needs

We often use the word “need” when we really use the word “want.” Because our needs feel powerful, without conscious thinking, we describe them as wants. Kids do the same thing. But teaching them the difference is important. It allows them to use better critical thinking skills when they make decisions. 
To help kids become more money-savvy, be clear about needs being for survival, and wants to be everything else.   
When “cash-clever kids” learn this concept, they are better able to create strategies that take care of their needs before they address their wants.

2. Let Them Earn Their Own Money

Nothing spurs independence and an entrepreneurial spirit in a kid than them earning their own money! Those first few dollars can start a snowball effect on their long-term financial planning. 
When children work for their money, they know its value. It gives them the perspective they need to be able to not indulge in every material desire. 
Here are some great ideas to jump-start your kids’ money-making endeavors. They can even use journals for kids to brainstorm their ideas. 

3. Set Savings Goals

Earning money also lets them see that they can make progress toward big purchases. It takes planning and effort, but working toward a challenging goal is part of what strengthens their mindset. 
Even if your child doesn’t have a job, setting up savings goals can help them learn the same lesson. By discussing how much money you can put toward a desired purchase each month, you model budgeting and financial planning.  
If your child can earn their own money, consider offering to match their savings. It sweetens the deal and shows them you’re invested in their planning process, not just saying “no” to the item. 

4. Leave Room for Mistakes

Even the best plan can come undone. Children make mistakes, and parents need to give them room to make them. 
Mistakes are some of the best teachers. They show children that they can grow and change. We can help them process their mistakes by asking questions. When we help them get to the center of the issue, they can better develop strong social and emotional skills. They also see growth as the reward, not just the outcome. 

5. Provide a Place to Save

The idea of saving money is one thing. The act of saving it is another entirely. Kids need a place to put the money they’re saving, and they probably need your help with it.
Whether it is a piggy bank or a savings account, children do better when they see the physical money and understand its representation. You can incorporate visuals like a chart, a bank book, or journals to help them “see” that their money is growing.
Discussion is an essential part of the process too. Talk to your kids about the what and why of what you’re doing. Help them remember why they’re saving money. It can keep them motivated to stay in the long game. 

6. Have Them Track Spending

The flip side of the following saving is tracking spending. Kids of all ages should be taught how to save and spend. Helping them see where they spend their money can give them insight into their financial personality. 
Consider using an expense tracking sheet to help them follow their spending. Showing them how they are saving, spending, and giving is a powerful tool to develop their fiscal understanding.   
It can even help them understand how money works. They need to earn money to have it to save or spend. To earn money, they need to work. They learn that money is an exchange for time.

7. Offer Savings Incentives

Just like some adults, some kids have an intrinsic “saver” mentality. Some have “spender” mentalities. The savers need to understand that some spending is ok and even good. It’s also important that the spenders learn to save.  
With saving, children learn that when setbacks and unplanned expenses happen, they don’t need to be catastrophic to their goals.
You can also offer incentives to make saving more exciting. It could be a money match or other contributions to their accounts. By buying into their savings plan, you are buying into their efforts too. You show them you believe they can do it.

8. Teach Them Contentment

Money isn’t everything. Having (or not having) money doesn’t make your child more or less worthy of happiness. When we teach our children that money is a tool and happiness comes from who they are, they learn to find contentment. 
Contentment comes from being happy with what you have. It allows you to want things and be able to say “no” to them. It also breeds gratitude and giving. When we’re not grasping for more, we have more generous hearts. Consider helping them reflect on their gratitude by keeping daily gratitude journals. 
It’s great to have goals, but it’s also important to remember that reaching the goal is just a mile-marker. The real progress happens on the journey. 

9. Set a Good Example

More than anything, kids watch what we do. If we want our children to develop financial literacy, we need to demonstrate it.  
As parents, it is our responsibility to create and stick to budgets. Our children need to see us save for purchases large and small. They need to see us understand the power of our spending.  
Kids also need to be taught about money directly. If we encourage them to develop their financial skills at a younger age, we can better insulate them from costly mistakes in their futures. They learn how to use the money before the stakes are high effectively. 


Discussing and teaching our kids about money doesn’t need to be awkward or difficult. Start small by determining where your child is in their understanding and build from there. Give them opportunities to experiment, learn, and grow their knowledge. Soon, they’ll be on their way to financial responsibility, security, and wealth. 


Author Bio:  

Alexandra Eidens is the founder of Big Life Journal, an engaging resource to help kids develop a resilient growth mindset so they can face life's challenges with confidence.