5 Ideas to Teach your Kids About Money

By Michelle Cornish, CPA

Did you know there are five main things you can do with money? I’m sure you can guess what some of them are:  spend…save…earn. What about the other two? Any ideas? What else do you need to teach kids about money?

Invest and share!!

What to Teach Kids About Money

It’s important that you cover each of these ideas with your kids. Let’s start with earning money because you can’t do any of the other four things if you don’t have any money!


There are a number of ways kids of any age can earn money. It’s important to start early so you can move onto the other ways money can be used. For young children, you may have to get creative.  Here are a few ideas:

  • Allowance
  • Tooth fairy
  • Birthdays or special occasions
  • Sell old toys or books at a garage sale
  • Lemonade stand
  • Sell crafts or artwork
  • Take bottles to the bottle depot

Older children have a few more options when it comes to earning money especially if they are old enough to get a job!  Here are some ideas for older kids:

  • Mow lawns
  • Shovel snow
  • Paper route
  • Errands for friends or family that can’t get around
  • Babysitting


When kids are younger than about 9 years old, they want to buy things of their own but they don’t know a lot about money. So, it’s important to look for opportunities to teach them about how we spend money. Credit cards are a good example. Young kids don’t know that items purchased on credit still need to be paid for so be sure and explain it to them and talk about the importance of paying with cash.

Let your kids “pay” for things at the grocery store.  Even if you are giving them the money to pay, they will still learn how the transaction works by handing over the money and accepting change.

Once kids are in their pre-teens and are earning a little money of their own, they typically want to spend their money as quickly as they earn it.  One way to teach them about delayed gratification is to have them create a wish list of what they want to spend their money on.  Have them wait even one or two days and review the list to see if they still want to buy those items or if there are new things they want to add to the list.


As kids begin spending their money, parents worry that they aren’t going to learn how to save. You can use their wish list as a way to teach them about saving too.  

Young children are still learning the concept of money so this is a great opportunity to teach them that when you save your money you end up with more money and can buy the bigger ticket items.  Have them pick an item on their wish list that they want to save for.  Every time they put money in their piggy bank, help them notice how much closer they are to their goal and how much more they have to go.

Older children are likely ready to open a savings account. Explain the different types of bank accounts (checking and savings) and also explain how interest works. Be sure and tell them how compound interest works too: you can earn interest on your interest!! This is one of the main advantages a savings account has over a piggy bank, and many banks offer savings accounts that don’t charge service charges.


The best way to teach young children about investing is through a lesson in entrepreneurship. If they have chosen to open a lemonade stand as a way to earn some money, explain to them that they can use some of their profit to purchase supplies for the next time they open the lemonade stand. They are investing in their business!

Kids that are around 10-12 years old can benefit from the entrepreneurship lesson as well but it’s possible that by this point they’ve been earning their own money for a number of years. They may have a good stash of cash in their piggy banks or savings accounts. Here’s where you can introduce other banking products (mainly investments that pay a higher interest rate than a savings account).

Be sure to explain that in exchange for a higher interest rate, their money is essentially locked in the bank for a set period of time. They have a chance to earn more money by having their money invested in a product like a Guaranteed Investment Certificate but they won’t have access to the money for a set period of time.


Kids need to learn about money; There are 5 ideas that are critical: earn, spend, save, invest and share.
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A big part of sharing money is attitude. It’s really difficult to feel like you can share your money if you always feel like you don’t have any. Try and change this focus to being thankful for what you do have and you will find it easier to share with those less fortunate.

Young kids can learn to share money by helping you pick out a Christmas gift for a child less fortunate. For older kids that earn more of their own money, you may want to ask them if they want to use some of their own money to buy a gift to donate. It’s great for kids to learn how good it feels to share money. If they feel like they don’t have enough money to share, offer to help them find a way to make it happen. This could lead to a great conversation about budgeting. 

Remember that your values also influence what you teach your kids about money: read more here.

What questions do you have about teaching your kids about earning, spending, saving, investing and sharing their money? Leave them in the comments below.

Michelle Cornish, CPA, helps you understand how to start teaching your kids about money.Michelle Cornish is a Canadian CPA, helping moms find more time and money in their lives so they can start or grow their side-hustle, leave their 9-5 and spend tons of time with the people who matter most!! For more money management and business tips visit my blog here.

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  • Michelle, the part about saving made me laugh. As a tween, my mom tried to encourage me to spend more of money! I was so focused on getting exactly what I wanted, she thought I wasn’t having enough fun.