Whether you have your own kids or you’re just the cool aunt or uncle, you have the opportunity to act as a role model so here is an article on how to teach your kids financial literacy. 

While some of these—like financial literacy, credit and protecting your identify may not seem like fun, they are valuable life lessons that can help the kiddos make and keep their money.

Out of all the conversations we have with children, finances may be one of the most important.  Early lessons about personal finance and money management can help them avoid issues later in life.  

Schools don’t always offer courses on personal finance and credit, so make sure you take ownership of teaching your kids about money matters. Read on for useful tips to help educate children early and set them up for future financial success.

From Preschool to Kindergarten:  Plant seeds early

By ages 2-3, toddlers can begin to learn attitudes and skills that will benefit their financial health later in life, such as:

Patience:  Just like waiting in line for the monkey bars, teach your kids that practicing patience pays off.

Focus: Read stories centered around finance to your toddlers and ask them questions.  Books like “How the Moon Jar was Made” by Eulalie Scandiuzzi and “Lemonade in Winter: A Book About Two Kids Counting Money” by Emily Jenkins are good examples.

Task Completion: Practice sorting money, such as splitting $1 bills in one stack and $5 bills in another.

Elementary School: Teach Good Habits

Kids heading into elementary school begin to pay more attention to what’s going on around them. Ensure they’re learning good financial habits by:

how to teach your kids financial literacyLetting them earn money:

Assign chores around the house so they can associate task completion with wages earned.

Opening a bank account:

Teach the importance of saving by opening an interest-bearing savings bank account where they can deposit money they’ve earned.

Making learning fun:

Play financially focused games, such as Monopoly, Game of Life, and Sims that involve making important and strategic decisions. Playing games can be a great way to explain the concept of risk and reward, which can lead to conversations about the stock market.

Setting a good example:

Share your personal strengths, such as frugal shopping, couponing, or meeting your family’s saving goals.  Show them the rewards of saving by going on a family vacation or buying a car.

Middle School: Incorporate Daily Involvement as You Learn How to Teach Your Kids Financial Literacy

Ages 10-14 are a great time to involve kids in real-life financial decision making scenarios.  Emphasize rule of thumb and day-to-day habits for saving, spending and shopping through:


Make shopping lists together to show the importance and eciency of pre-planning and not buying frivolous things.

Financial Maturity:

Teach your kids the difference between financial wants and needs so they start to understand how to prioritize money and learn to save for the future. 


Part of how to teach your kids financial literacy is to help them build budgets for meals, events, and other extracurricular activities. This shows them how planning ensures they’ll have money for the things they want and need.

Bargain Shopping:

Compare the prices of different products and brands, and actively find the best deals.  Use:

  • Honey: A browser extension that automatically finds and applies coupon codes at checkout on thousands of sites.
  • Groupon: An online service that offers local deals and goods at a large discount.

High School: Build Credit Knowledge and Begin Investing

As they begin to manage their own money, high schoolers can build credit, and start investing in the stock market. Help them understand the ins and outs of moving into this next stage of life through:

First-hand experience:

Add your teenager as an authorized user on one of your credit cards. Just be sure to teach them about responsible spending. And remember, as the main account holder, you are ultimately responsible for anything they spend.

Credit card comparisons

Part of how to teach your kids financial literacy is to show them how to compare different credit card features, costs, and finance charges.

  • Help them learn the types of cards that exist and how to understand the differences.
  • Explain the benefits credit cards can offer and the importance of paying off, or keeping balances low.
  • Introduce the costs of owning a credit card, such as Annual Percentage Rate (APR) interest rates, and annual fees.

Credit knowledge

Once they’ve established credit, show them how to check their credit report and what to look for.

  • Teach them to check their credit reports regularly regularly, what is included (e.g. personal information, accounts, inquiries), and how that information can impact your credit scores.
  • Be transparent. Show them your personal credit report so they can see how past behaviors can have a positive or negative impact.
  • You can go to any and all of the three credit reporting agencies to get credit reports and for an extra fee, you will receive your FICO score.  Annualcreditreport.com is the only agency that allows you access to your credit reports once per year, and you can discover what the three credit bureaus,  Experian, Trans Union and Equifax, are reporting and whether you notice any errors.

Identity protection

Now is the perfect time to help your child understand how to protect their personal information which is another part of how to teach your kids financial literacy.

Planning for college

Talk through your child’s plans for the future and how they can achieve their goals by looking at the various options available to pay for college.

  • Go over the difference between federal loans, such as Stafford and Perkins Loans, and private loans.
  • Teach them how to pay off their student loan debt electively and strategically through smart choices, such as using auto-pay for bills.
  • Educate your children on the importance of applying for and actively seeking out scholarships.
  • Explain that part-time employment and saving to pay for college are both viable options.

For more information, visit the Experian blog.