How to talk about money as a family

Between birth and high school graduation, kids form the foundation of who they'll be as adults. They'll learn new concepts in school, pick up behaviors from their friends, and look to you for guidance on everything from tying their shoes to choosing a sport to play. As a parent, you'll act as a mentor and protector — which is why talking about money as early as possible is important.

The importance of early financial education

Sometimes, parents shy away from talking about money with their kids. They may worry that their kids aren't ready to hear the ins and outs of retirement planning, taxes, saving, or budgeting a paycheck. But having those money conversations now helps kids build the foundation they'll need to attain financial independence as adults. With the knowledge you provide them, your kids will better manage their cash flow once they move out or start their first job.

The beauty of introducing financial literacy to your kids early is that you have years to ingrain good habits well before they reach adulthood. That time allows you to break down major concepts into easily digestible knowledge nuggets. 🎓 Once they master one concept, you can move on to the next one.

And here's a tip: you don't have to be a personal finance whiz to start money talks with your kids. Today's technology makes it easier than ever to teach kids about money. 

Greenlight's money app was made for kids and teens to learn about financial concepts on their own. It includes lots of fun games and interactive activities to keep them engaged as they learn the basics of spending, budgeting, and investing. Combining Greenlight's app with your parental lessons helps kids build a solid financial backbone for the future.

How to create a positive money dialogue at home

Not sure how to talk about money with your kids or teens? Use these tips to get started. 

Tailor financial lessons to different age groups

Some financial concepts are harder to understand than others. It's safe to say your five-year-old probably isn't ready to learn about the New York Stock Exchange (NYSE) or filing income taxes. However, your 14-year-old might be. Try to introduce financial topics that are age-appropriate for your kid. If you start conversations about money and your kids seem to lose interest after a few minutes, the topic may be too complex, or you might want to approach it differently. 

While every kid learns at a different pace, you might teach kids under the age of 10: 

• How to count coins and bills

• The history of coins and bills

• How to count change

• How to compare prices when grocery or clothes shopping 👚

• How to save a percentage of earnings from chores or their allowance

• How to divide money into categories, such as saving and spending

• How to establish money goals, such as saving for a new toy

• How to distinguish between wants and needs

• What debit and credit cards are, and how they work (they’re not just plastic!)

Older kids and teens can understand more complicated personal finance topics, like:

• How investing works 📈

• The importance of saving for retirement, financial freedom, and financial security

• Basics of filing income tax returns

• How to build, maintain, and establish credit for a healthy financial life

• Banking for kids and using a debit card

• Process of buying a house or leasing an apartment

• Setting up a monthly budget and paying bills on time to prevent money issues

• Avoiding common money mistakes like overspending 

Turn everyday activities into financial lessons

Think about all the financial transactions and activities you deal with in a day, week, month, or year. There's probably a lot. Paying monthly bills, managing the family financial plan, and setting aside savings are all activities you can use to introduce financial concepts to your kids. Instead of handling everything yourself, ask them to sit down with you the next time you're mapping out the week's upcoming expenses. Show them your paycheck, and describe the things you need to pay to keep the household running. They’ll see your budgeting in action! 

Another great real-world learning opportunity for kids or teens comes with major financial purchases. Next time you're in the market for a new car, house 🏡 or other significant investment, bring your kids along for the experience. Let them watch you apply for an auto loan or mortgage and describe your actions. You can dive into topics like interest rates and credit scores and discuss how they impact the cost of the loan. They can also help in the shopping process as it will allow them to see the variance in prices and how they affect your monthly payments.

Encourage smart saving and responsible spending

From an early age, showing kids how to save and spend their money wisely is critical. Let's say your kid wants an expensive gaming console. Instead of buying it immediately, talk to your kid about how to save or work to earn it. If you provide them with a regular allowance, help them establish a savings plan. You might also suggest taking on odd jobs or doing extra chores to hasten the savings process. Greenlight’s app includes a chore list feature you can share with your kids. Any time your kids complete a job, you can reward them with set earnings for their hard work. 

Set financial goals as a family

Is there a financial objective you have that impacts the whole family? Maybe you'd like to plan a fun vacation or get your kids involved in saving for their future college education. Instead of handling the logistics yourself, get the whole family involved. Find time to discuss the goal and ask for ideas to make it happen. Use the opportunity to talk about the goal's cost and how to save for it. Your kids will appreciate being a part of the family finances, and they'll pick up some essential money guidance, too.

Leverage technology for engaging financial education

Talking to your kids about money sets the stage for future financial responsibility. Eventually, your kids won’t rely on you for all their financial needs. If you provide the building blocks for financial literacy, they’ll have a smooth start to managing their own funds. 

Today's kids have many opportunities to learn about personal finances through fun games and activities. Greenlight's stimulating money game offers just one such opportunity. It showcases essential concepts to guide kids in their financial journey while being entertaining. 

Get the Greenlight financial literacy game today to inspire your kids' money confidence and start teaching them how to save, spend, and invest.