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Teaching kids financial responsibility

Established Member

Teaching kids financial responsibility

What do you do to teach your kids about being responsible with money?  My kids are 10 & 13 and right now they earn money by doing extra work around the house (outside of their normal chores they have as being part of our household) and while we can afford to give them extra things, we limit it to holidays/birthdays and special occasions. (Like when my son who has ADHD and was struggling with grades got on the honor roll 2 quarters in a row we signed him up for the extra marital arts class he'd been asking for)  If they want something like a video game or a new build a bear we show them how much it costs and what work they needs to do to earn it. 


It's too easy for kids to become entitiled when things come easy.  Neither DH nor I had a ton of money growing up and our parents couidn't help us with anything and we're grateful for it as we learned (many times the hard way) how to be responsible.  We messed our credit up and had to rebuild and are just now at a place where we have decent credit scores.    We want to help our kids get a good start early so they don't lose 10 years of good credit building like we did making mistakes and having to grow from them.  


What age do you add more responsibility and teaching?  Now that my son is 13, we want to start showing him a bit more but don't want to overwhelm him either.  

In the garden until 10/2019
Message 1 of 15
Super Contributor

Re: Teaching kids financial responsibility

Any age where they first come in contact with money.  I also think they should teach this in High School as part of practical skills young adults need to go out in the world.

10/15/2018: FICO 838 EQ 827 TU 826 EX
Message 2 of 15
New Contributor

Re: Teaching kids financial responsibility

JalyM05 that's very nice of you to teach your kids financial responsibility. My mom opened a savings account for me and my younger sister when we were in 2nd and 3rd grade (passbook) in 2 different banks. We get rewards usually, loose change or cash after we did more than our usual chores and if we behaved well in meetings and event LOL. Also during summer and christmas break we earn a little for setting up housemade refreshments, snacks and surprise toys that we sell to other kids in the neighborhood. And also in my home country, giving cards during holidays is not a big thing. Instead I would receive an envelope with cash inside. As a grade schooler I really enjoy when my mom would take me to bank to deposit my coins and bills saved Smiley Happy
Message 3 of 15
Valued Contributor

Re: Teaching kids financial responsibility

I still have my first savings account passbook... it was opened when I was with all of $10.


But that was where I started. Now I'm a thrifty saver who is only part-way through college yet is contributing to my IRA. There are two things I can credit to my father for that put me where I am today:

  1. Good record keeping. Whether it's an a couple small notebooks (How I started) or in Excel spreadsheet (How I expanded later), keep track of money in, money out, and account balances.
  2. Emphasize the difference between necessities and wants. You mentioned a video game. Nowadays, I only buy one AAA game a year, give or take, because saving is more valuable down the road. When I was their age (Before all the plastic), I had the cash in my hand whether I saved it or I spent it, which was a very important connection when just learning. To be a kid and fill up an envelope with $1's (Because that's what I got for doing chores and whatnot) feels pretty darn good.

TU FICO 8: 755 (11/18) — Ex FICO 8: 757 (11/18)
Message 4 of 15
Senior Contributor

Re: Teaching kids financial responsibility

My parents booted me out at 13 but from 10-13 they taught me one area I still hold on to today: utility bills.  I was in charge of setting the thermostat/light switches and if the utility bill was UNDER a certain amount I got to keep the difference.


At 11 I was a fascist about freezing in winter and sweating in summer, lol.  And no one needs a light on to go anywhere after 8pm, right?

Message 5 of 15

Re: Teaching kids financial responsibility

They are children that's why they do not feel responsibility with money yet. It comes with age. 

Message 6 of 15
Established Contributor

Re: Teaching kids financial responsibility

My daughter is 2.5


Mostly joking, but i've considered using her halloween candy as a replacement for currency. Let her deposit it in my stomach to earn interest.  Perhaps allow her to take credit through the year, and garnish her candy the following year for lack of payments.


I think that by the time she is 7 or 8 she will wise up to the credit game and increase her candy score considerable.



We do not usually allow candy in the house. Halloween being the rare exception.  Without additional candy income, her credit will be poor.

She might change all of her future money into candy to game the system more.

Unhealthy obsession with sweets?


As for real life finances, I signed her up as an AU on my oldest card. My dad did the same when I was born, and it helped me a bunch during my early 20s. Would have helped more if he had a better knowledge of credit, and helped teach instead of just providing a potential shovel. Also when he died and 7 years passed, my credit took a dip. I must remember not to die prematurely until my daughter is self established.


We will be having a large family gathering at Disney World in 2022, I'm thinking of giving her a Disney gift card as a "credit card", just to see how quickly she spends her available balance.  Not being able to buy an additional stuffed animal will be a hard lesson. But important.  Plus I'll buy it for her anyway because I am a sap.



Message 7 of 15
Valued Contributor

Re: Teaching kids financial responsibility

Kree wrote:

My daughter is 2.5



As for real life finances, I signed her up as an AU on my oldest card.

I may be mistaken, but I thought most banks required AU's to be of a certain age? Either way, she has a better report than most 25 year olds! Well done!

TU FICO 8: 755 (11/18) — Ex FICO 8: 757 (11/18)
Message 8 of 15
Established Contributor

Re: Teaching kids financial responsibility

You said extra marital class? Just wondering. lol

Message 9 of 15
Valued Member

Re: Teaching kids financial responsibility

I just got my 12 yr old a youth checking and savings combo. I turned off the overdraft so that if the money's not in the account it will just deny the transaction. He's been pretty good about saving his money for what he wants, now he can do it electronically. I think talking to him about what we've been doing to fix/improve our credit and finances has had some affect, showing him how mom and dad "walk the talk". The intent now is to show him how to save his receipts and match them to the bank info to get the real balance and how to calculate compound interest. He's in advanced math classes so it will be easy for him. Your 13 yr old can probably do the interest to with a little help or at least do what most adults do and use a calculator. Both can easily handle the arithmatic of balance checking. As far as credit goes you might try making up a "PLC" parental line of credit - you could probably do an spreadsheet in google docs to figure interest and keep track of "charges" and "payments". Just a thought. 

He may work to make the money, but I work the money to make our lives better.

My Cards: Home Depot, Blue Cash Preferred, Sapphire Preferred, USAA Cash Back Rewards AMEX --- Total CL: 19.7k --- FICO 8 EXP Score 03/18: 744

DH Cards: USAA Rewards Sig Visa, NFCU Platinum, Lowe's, Sam's Club MC ---Total CL: 19.3k --- FICO 8 EXP Score 03/18: 746

Message 10 of 15