Key Takeaway: Start early with simple, age-appropriate money conversations. Keep it positive and practical, and model healthy financial habits at home.
When should these conversations start?
Ultimately, each family is different, and what feels right for one won’t necessarily be the best timing for another. From a young age, children will start to develop an understanding of basic math in the classroom, and using money as a conduit for enhancing their knowledge is a great way to introduce the topic.
They will likely start to recognise money by two or three-years-old, but when they reach five or six, they will generally start to grasp the concept of money, and even begin to form opinions and attitudes towards it. Conversations at this stage should be kept fun and engaging – it’s generally advisable to save introducing more serious topics until they’re slightly older.
The value of pocket money
Pocket money or an allowance is a great way to introduce children to the principles of financial management. Even if it’s a nominal amount of money you give them each week, giving them some level of responsibility will help to shape their attitudes towards money and the value of it.
Again, there isn’t necessarily a right or wrong time to start giving them pocket money, but as soon as they start to understand the concept of money, it can be a good time to start.
Ages 3-5: Basic Concepts
Children can learn that money is used to buy things and that different coins and bills have different values.
Ages 6-10: Earning and Saving
Children can start earning small amounts through chores and learn about saving for things they want.
Ages 11-14: Budgeting
Introduce concepts like bank accounts, interest, and creating simple budgets for their allowance.
Ages 15-18: Advanced Concepts
Discuss credit, loans, investing, and preparing for financial independence.
FAQs
What age should I start talking to my child about money?
Begin with simple concepts (like saving and spending) around ages 5–6. Keep it fun and practical with small, everyday examples.
How much pocket money should I give?
Choose a small, consistent amount that matches your child’s age and responsibilities. Focus on learning value over the amount.
How do I teach saving vs. spending?
Use clear jars or envelopes labeled Save, Spend, and Share. Let children make small choices and discuss outcomes together.
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