Teaching Kids About Money: Simple Lessons That Stick
Kids often understand much more about what’s happening in the world than we realize, even if they aren’t aware of all the details. Any child who can log onto YouTube has likely seen attention-grabbing headlines about the economy in the past few weeks or heard grown-ups grumbling about the markets, rising grocery bills, or Tax Day.
Instead of defaulting to “You don’t have to worry about that,” why not use your kids’ natural curiosity to spark a healthy conversation about the mechanics of the markets, individual investing, and teaching kids about money in a way that feels engaging and empowering? Before suggesting some activities, let’s discuss why now is the right time.
Why Now?
When someone asks when to start working on a financial plan, I say, “It’s never too soon to start—or too late.” The same applies to your kids. Most schools don’t offer many personal finance courses. Your kids can benefit from any knowledge you have gained. That’s why teaching kids about money at home is more important than ever—it fills the gap left by most school curricula.
Why? Early habits stick. Research shows kids form their money attitudes by AGE SEVEN! And with more digital transactions and fewer opportunities to handle cash, kids need to understand how credit and debit cards, apps, and online shopping work.
Add in today’s economic uncertainty, including rising prices, market swings, and job changes, and it becomes clear why financial literacy is more important than ever.
At Apprise, we work with women facing new beginnings. But our kids experience meaningful transitions, too, such as graduating or landing their first full-time job. These moments can serve as powerful teaching opportunities.
Giving your kids a financial education leads to better conversations at home. It can build confidence for family money talks. It can also lower the stress around “taboo” topics.
Tailoring each of the following activities to your child’s age and maturity could help plant financial habits that grow for years to come.
1. Fun, Engaging Ways to Start Teaching Kids About Money.
Why not make things fun? You can play games like Monopoly or Life. When you take them shopping, ask them to try to keep track of the cost of the items you buy. If they come close, you can offer them a little reward.
You can also match their savings to encourage good behavior. If they work, consider opening a Roth IRA for them. It’s a great way to reinforce healthy financial habits early on. When one of my sons, who is working his first full-time job, funded his Roth IRA and his Health Savings Account earlier this year, I told him he would remember me fondly long after I was gone. Why? Starting to save for retirement at such an early age will allow him to retire early or do more things that he enjoys later in life.
None of us is perfect. Share stories of your own money mistakes and the lessons you learned.
Once you’ve introduced basic money concepts through play or simple activities, you can begin connecting them to real-world decisions.
2. Review your child’s recreation budget.
Many parents complain that their kids don’t really “understand” how much things cost. But have you ever actually shown your child a detailed breakdown of their expenses?
Start small. A spreadsheet that accounts for all the camps, sports leagues, and clubs your kids will be enjoying this spring and summer, as well as costs for new clothes and equipment, can help them realize that fun requires planning and investment as well. If they’re really desperate for a family trip to a big-ticket theme park, price out a week’s stay and talk about how your family can start saving. Working teens might even feel inspired to chip in a little themselves. (You might even return the favor by surprising them with a gift shop treat. Or let the lesson stick.)
Once they understand how your family spends money, it’s a great time to show them how it can grow, too.
3. Open custodial accounts.
Since your kids were born, you’ve probably been depositing baby gifts and investments into custodial accounts. If you don’t want to share those balances with your kids, open another set of custodial accounts that you’ll review together monthly or (better yet) quarterly. Any time grandma writes them a check, you can deposit it in their account, too. Explain how investors who stick to their plans during market volatility often have opportunities to “buy low” on depreciated stocks that will gain in value once the markets rebound. Agree to deposit a percentage of any money gifts they receive into their new account. You can track performance in a chart or spreadsheet, so your child can visualize what they’re contributing and how their new nest egg is growing. You could even open both savings and investment custodial accounts so that they can compare how the two perform over time.
One significant caution. If you think you may qualify for financial aid, custodial accounts can reduce eligibility. They’re your child’s asset, meaning they carry more weight in aid calculations. Instead, consider opening an account in your name with a transfer plan for after graduation or using a 529 plan, which is treated as a parental asset. When used to pay qualified education expenses, 529 accounts also provide tax-free growth.
Eventually, those savings and investments lead to another important lesson—understanding taxes.
4. Talk about taxes.
While just hearing the phrase “Tax Day” might raise your heart rate as April 15th comes and goes, take a breath and explain how taxes work, why we pay them, and what kinds of services they fund—like schools and police and fire departments—that your child already knows and relies on. Next time you’re shopping together, point out the sales tax charge on your receipt.
Hopefully, reminding your working teen that, yes, they, too, have to file a tax return was part of your tax prep as well. If your teen had a part-time job last year, now’s a great time to walk through their tax return with them. Most will qualify for a refund. Plus, the process is simple.
For older kids starting full-time work, ask how their first Tax Day went. That opens the door to discussing the difference between once-a-year prep and a long-term tax strategy.
At Apprise, we’re here to support financial conversations for the whole family. Whether you want to open a custodial or 529 account or simply begin teaching your kids about money with more intention, we’re here to help. Let’s work together to help your children build confidence around money and their personal finances–starting today.
Schedule a call, and let’s get started.
This Week’s Favorite Reads
This week’s favorite reads include articles discussing telling your children about your wealth, suggestions to help you make changes to your life, tips that can aid your efforts to get your finances back on track after divorce, peak vacation happiness, and gifting appreciated assets.
Here are the links to this week’s articles, as well as a brief description of each and why you should check it out:
1. Tell your adult children about your wealth — just don’t tell them everything.
Teaching your kids about money can also include telling them about your wealth. These conversations can help minimize conflict and reduce the amount of misunderstanding after a parent’s death. However, sometimes, it involves walking a fine line, as you don’t want to provide a disincentive for them to work. Consider proceeding in stages if you don’t know how much to disclose. You may want to start by telling them about the financial professionals you work with. You can share more details when you think the information will benefit your children. You will find additional suggestions about how to deal with this sensitive issue in the article.
2. Want to Change Your Life? First Change Your Algorithm.
If you want to change your life, start by changing your algorithm—the collection of patterns, habits, and inputs that shape how you think, feel, and act. Just as digital algorithms influence what we see online, our internal algorithms determine how we respond to the world.
According to this article, most people live on autopilot, driven by outdated beliefs or unconscious behaviors. But meaningful change starts with awareness. Begin by noticing what you consume, how you speak to yourself, and where your time and attention go. Then, start curating better inputs, including books, conversations, routines, and environments that support who you want to become.
Creating lasting change isn’t about willpower. It’s about intentionally rewiring your internal system. Shift your algorithm, and you’ll shift your life. That’s the foundation of any good life plan—one that aligns your habits with your goals and your mindset with your values.
3. How to Get Your Finances Back on Track After a Divorce.
Divorce is both emotionally difficult and financially disruptive. Once the dust settles, it’s essential to reassess your finances and rebuild with intention. Start by understanding your new financial picture: Know your income, expenses, and debts. If you received assets in the divorce, know how they work, especially retirement accounts that may be taxed differently than expected.
Create a realistic post-divorce budget, adjusting for new housing, insurance, and potential child or spousal support. If you left the workforce during your marriage, consider how to rebuild your earning power, whether through upskilling or re-entering the job market.
You should also revisit your financial goals, including retirement, college savings, and emergency funds, and update beneficiaries and estate documents accordingly.
Most of all, give yourself grace. While divorce represents a significant life transition, it’s also a chance to reset your priorities, reframe your values, and build a financial life plan that reflects who you are now.
4. The Exact Hour You Hit Peak Vacation Happiness—and How to Make That Feeling Last?
According to research cited in this article, vacation happiness peaks around hour 43 or about two days into your trip. Why? Neuroscientists say we thrive on novelty. That “first” cocktail, the first view of the ocean, or the first sandcastle triggers a rush of joy. But as we settle in, we begin to habituate, and the thrill fades.
Try shorter, more frequent getaways or mix up longer trips with varied activities and new locations to keep the good feelings going. That change of pace—called dishabituation—refreshes your perspective.
Even better? You can bring this mindset home. Slight changes to your routine, e.g., exploring a new trail, learning something new, or taking a different route, can boost creativity, lower stress, and improve your well-being. Whether on vacation or not, your brain benefits from breaking patterns. That’s a lesson worth remembering—especially when planning how to make the most of your time, energy, and Return on Life.
5. Should You Gift Your Appreciated Assets During Your Lifetime?
Gifting appreciated assets during your lifetime can be meaningful, but it isn’t always the most tax-efficient move. When you give appreciated securities to individuals, they inherit your cost basis, meaning they’ll owe capital gains taxes when they sell. By contrast, assets passed after death receive a step-up in basis, often eliminating those taxes.
Still, lifetime gifting can make sense if the recipient is in a lower tax bracket. However, be cautious when gifting to minors, as the kiddie tax rules may apply. It can also affect financial aid eligibility. An alternative, “upstream giving” to an older parent for step-up purposes, also poses risks.
Here’s the bottom line: Taxes matter, as do relationships and legacy. If you’re considering gifting appreciated assets, ensure your strategy supports your financial goals and values. Work with a professional to find the right balance between tax efficiency and the impact you want to make.
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If you would like to speak with us about financial topics, including facing new beginnings, managing your investments, creating your life plan, or saving for retirement, please complete our contact form or schedule a call or a virtual meeting via Zoom. We will be in touch.
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