Would you like your child to be financially secure in the future and able to pursue most of their dreams? You can start building that future today by introducing the basics of finance for kids and teaching them the essential things everyone should know about money.
First Introduction to Finance
Teaching financial literacy can begin with small steps suitable even for toddlers. Children can play with coins, sort them, and group them into categories. You can make the activity a bit more challenging by offering matching cards - ask your child to match a picture of a certain coin to the correct real one.
Later, when your child learns basic counting, you can introduce simple exercises such as making up a specific dollar amount using available coins. For example, find enough 25-cent coins to make 1 dollar. To make it more fun, you can put price stickers on toys and ask your child to find the correct amount in their coin box, using coins of different denominations.
Another way to present finance for kids is through engaging stories. For example, you can talk about the history of money: explain how people first exchanged goods of equal value (barter), and later replaced this system with money for convenience.
Games That Help Explain Finance for Kids
Montessori learning encourages explaining complex concepts through play and hands-on experiences. So, when you want to teach your child how to handle money, understand its value, and build responsible financial habits, you can also use various games to make it fun and engaging.
Piggy Bank and Savings Goals
Buy or create a beautiful piggy bank together. Explain to your child how to use it and discuss setting a small yet inspiring savings goal. Encourage them to save part of their money, track their progress, and eventually buy something they’ve been dreaming about. Let your child pay for it in a store: it helps them feel not only the joy of reaching a goal but also the experience of spending what they've saved (and feel so grown-up while doing it!).
Putting money into a piggy bank teaches children patience, goal setting, persistence, and responsibility. It also helps them practice resisting the temptation to spend the saved amount on something else.
“Supermarket” Role-Play Game
Set up a mini store right at home. This role-playing game teaches kids how buyers and sellers interact and also strengthens their addition and subtraction skills. In your home supermarket, you can use either play money or real coins and bills. The “products” can be real fruits and vegetables, toys, art supplies, books, and more. Take turns – let your child be both the customer and the shopkeeper.
Math Games
Incorporate coins and bills into everyday math activities. Learning math naturally overlaps with understanding money. For more ideas, check out our article “Montessori Mathematics”, where we share plenty of math-based games and activities perfect for toddlers and preschoolers.
Monopoly
This classic money game is a great tool for introducing kids to money management, value creation, and basic economic principles. A simplified version of “Monopoly” can be played with younger school-age children.
There’s also a similar game called “Managing My Allowance”. It’s a money game with a board similar to “Monopoly”, but players complete tasks that mirror real-life situations: saving part of their income, spending on essentials, paying bills, and even investing to earn more. This game isn’t just great for kids: it can offer valuable insights to adults, too!
Helpful Strategies for Teaching Financial Literacy to Kids
In addition to playful financial literacy activities, there are other tools you can use to help your child grasp the basic rules of money management.
Through stories, you can introduce financial concepts in a relatable and age-appropriate way. Books can help explain why saving is important, and what can happen when someone spends carelessly or doesn’t plan ahead. For toddlers and preschoolers, try reading classics like “Bunny Money” by Rosemary Wells or “A Chair for My Mother” by Vera B. Williams.
In “Bunny Money”, the characters plan to buy a gift for their grandmother, but unexpected events force them to spend money on other things. “A Chair for My Mother” beautifully illustrates the idea of saving as a family for something meaningful and useful.
With older kids, you can move on to books written specifically for youth. One great example is “I Want More Pizza” by Steve Burkholder, written for teens, college students, and young adults. It explains what to do with money in the real world and makes budgeting feel less overwhelming.
Practice Budgeting Limits
The most challenging concept to teach is that money should be spent according to a plan, and not all at once. And at the same time, it’s important to explain this without making your kids feel like the family is in financial trouble. Still, financial education for kids should include the idea of limitations.
“Today we’re going to the movies. Our budget is $50. Tickets cost $3 each, and we can spend another $20 on snacks. We can’t go over this amount – but if we have anything left, you can add it to your piggy bank.”
Be a Role Model
You can’t consistently say “no” to your child while freely buying things for yourself. Most likely, you’re already mindful of your spending, so now it’s about showing your child how you budget, what you choose, what you pass on, and what you dream about. And when your financial goals come true, share that with your child, too. It will serve as powerful motivation for their own future goals.
Give Pocket Money
Pocket money is a powerful tool for financial education for kids. But it’s important to teach your child not just to spend, but also to save part of their money for bigger dreams and meaningful purchases.
This budget can include money your child receives for birthdays, holidays, or other occasions. There’s always a temptation for parents to manage this money themselves, but it’s crucial for children to learn how to handle their own finances. Even if they make mistakes, those mistakes are learning opportunities. Better to make a small error now than a costly one in adulthood.
Teach the Value of Money
To help your child truly understand money, you’ll need to talk a bit about your own work—where money comes from, how salaries are earned, and why we value the things we have. This gradual understanding helps children build respect for effort and financial responsibility.
How to Teach Your Child Financial Responsibility During the Teenage Years?
Teaching financial literacy continues into the teen years, and at this stage, parents have more opportunities to deepen their child's understanding. Here’s how you can support their development:
- Create a system of tasks or chores that your teen can complete to earn money.
- Plan and make purchases together to help them understand the prices of different types of goods and how to plan a budget.
- Explain the differences between debit and credit cards. You can even open a card for your teen to use under your supervision.
- Teach them how to use mobile apps for tracking personal spending.
- Allow seasonal jobs, as long as they are age-appropriate, safe, and don’t interfere with rest or school. By ages 14–16, teens can start earning money, which gives them a true sense of what money is worth.
This is just the foundation of finance for kids. It’s also valuable to show your teen how to make small investments, grow even modest amounts of money, and begin thinking about long-term goals.
Why Is This So Important?
Teaching finance for kids is just as essential as teaching reading or writing. Financial literacy is a fundamental life skill that affects a person’s quality of life in a very real way. By using Montessori strategies to teach financial concepts early, you help your child:
- Make effective decisions,
- Reduce impulsive spending,
- Build financial stability and confidence,
- Set and reach goals,
- Create savings and an emergency fund,
- Understand how to earn and grow money,
- Feel confident managing a personal budget.
It may seem like kids will figure it all out once they grow up, but many adults who weren’t taught financial skills as children end up learning through painful mistakes.
So, talk to your child about money. Teach them how to use it wisely from a young age. Let them make mistakes now, when the stakes are low. It’s never too early to explain how to buy that dream toy car, doll, or robot. In fact, early childhood is the perfect time to start. Whether it’s helping with everyday tasks, grocery shopping, saving small amounts, or playing games like “Supermarket” or Monopoly, every little effort matters.
