Posted: Mar 31, 2012 6:35 PM
From the time children are toddlers we can start teaching them about money and finances. Simple trips to the grocery store or bank can become terrific learning experiences. Talking about money doesn't have to be difficult. Follow these tips for discussing money with kids of all ages.

Mary Caraccioli, author, financial expert and host of We Owe What? on the Live Well Network, offers these tips to raise financially-fit kids.


I start my money lessons with preschoolers because I think the earlier you get in the habit of talking to kids about money, the smarter they will be. The visual rule works with this group too. I love to bring preschoolers to banks and to have them draw pictures. Tell your kids to draw a picture of something they want. Then have them draw a picture of something they want to give. Using an image that matters to them, you can talk about how it takes money to buy certain things and that other things -- like hugs and kisses -- are free. Encourage your preschooler to start saving their pennies and those cash gifts that come in birthday cards -- or their allowance.

7- to 12-year-olds

I love playing the grocery store game with kids in this age group. It can be modified to fit their level of understanding. Here is how it works: Have them help you write a list for the grocery store shopping trip (great bonus lesson because it will teach them not to go shopping without a list). Next, have a rough idea of what these groceries will cost (keep your previous receipt for some help here). Then, tell them if they can help you fulfill your list for less than the total you wrote down, they get to keep the savings. This game teaches them to really look at prices when you shop and to understand that choices have to be made to keep you within a budget. Allowing them to keep the difference is incentive to save.


I like to use the idea from the grocery game and apply it to clothes and technology -- areas where most teens spend, spend, spend. Making a list before they go shopping and encouraging them to find cheaper alternatives to things on that list -- then letting them pocket the difference -- will help them prioritize their spending. Forcing teens to live within their allowance also shows them the basics of managing their own finances. Remember, they are awesome negotiators so once you've decided the wallet is closed for the week, stick to your guns -- no matter how tough it is!

For all ages

Make sure you say no -- regularly. It isn't easy telling your baby they can't have something. But the earlier you start saying no, the easier it will be as your child ages. Even if buying that extra doll or pair of jeans isn't going to break the bank, still find the strength to say no. I often say things like: "I don't think you need it" or "it is not something I think our family should spend on today." It shows that it is not a matter of being able to afford something, but a bigger reason you aren't buying it: It is not something that adds value to your family. Eventually your kids will learn to think about how much value the things they buy bring to their life. And that is a money lesson they can keep for life!

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