Today in the lunch room at school, I mentioned that next week I’m opening up a new thematic unit on money. I started brainstorming some ideas of what I could do to motivate the kids and prepare them for the unit. As I was talking with another teacher (we’ll call her Claire), she mentioned that her grown daughter who lives with her recently complained about all of her “expenses.” Claire had to chuckle at this idea because her daughter really doesn’t have many expenses; she doesn’t pay rent, she doesn’t pay for groceries, she doesn’t pay for her own car insurance, she doesn’t pay for water or power, and she doesn’t pay for gas. When Claire’s daughter heard the word “gas” she said, “I pay for gas!” But Claire realized she thought she meant for the car, not to heat water or to light the stove! She quickly realized that her daughter is unprepared for the world of adult personal finance (and she’s 22 with a college education).

This conversation with Claire led me to realize that many parents, including my own, never openly discuss the kinds of bills they have to pay as an adult. They may often complain about all the “bills” or how little money they have left after paying them, but many young adults have no idea what that really looks like. So when is a good time to teach the topic of personal finance to children? Obviously, most children have a vague understanding of the value of money, they buy school lunches or purchase small items at the store, perhaps with their “own” money. Yet, at some point, it would be in the child’s best interest to be directly instructed on what a bill looks like and the kinds that need to be paid in a household. Here are some ideas I’ve gathered that would be helpful in teaching kids about money:

  • Age 5-8: Children should begin to recognize coins and bills and their values. Around the age of 7 or 8 it’s a great time to introduce the idea of an allowance and a piggy bank. Saving up for something special should be explicitly taught. The idea that once they spend that money, it will take them x amount of time to build up their piggy bank again.
  • Age 9-12: By now, kids should be able to easily count on up to a few dollars. They should also be working on counting coins back, so that when they go with you to the store, they can hand the cashier their money and figure out how much change they are owed back. At this age, they can also be in charge of the grocery list, checking off items and estimating what the total cost of the grocery bill should be. (A great way to introduce bills!)
  • Age 13-15: This can be a tough group to work with (hormones are raging!), however they now have enough mathematics skills to comprehend more difficult computations. Introduce a few household bills to them, talk about what is on the water and power bill, how much your monthly grocery bill is, and how you have to pay for car and home insurance monthly. I wouldn’t bombard them with all of your bills, just 2 or 3 to start.
  • Age 16-18: Time to get serious! Whether you’ve talked to your kids about the household bills or not, this is the time when you should. Show them the physical bill. Tell them how you pay it monthly, whether it’s online or by check. Again, you may not want to overwhelm them with all the bills. However, I would definitely introduce the basics: rent or mortgage, utilities, phone, groceries, car insurance. Begin teaching them about how to build up their credit and why a good credit score is important. I would model this to them directly; give them an example of someone you know you has lousy credit and how difficult it was for them to purchase a car or home, versus someone with good credit and how much easier it was for them to purchase these same items, and at a better rate!

Having your young adult somewhat aware of what kinds of bills they face in the “real world” will lead to a much easier transition into adulthood. Preparation is the key to happy personal finance!

Next week I’ll follow up on the activities I planned for my third graders. I’ll also be able to tell you, first hand, if it was successful and if they learned anything from it. Stay tuned…..

Have you had personal finance discussions with your child or young adult? Did they listen to you, or was it too much information all at once?


  1. @Simple Life in France – I admire you for teaching this age group! I’ve heard horror stories about middle school and intend to stay far away….the elementary aged students are much more appreciative of their teachers 🙂

  2. Every child is different, but generally I think you should drop the age ranges. I agree with Ingrid, we don’t give young kids enough credit for their ability to learn and comprehend.

    However, I love how you have broken financial concepts into groups to be measured out over time. This is one thing I failed to do. I began throwing all the concepts, in simplified form, to our kids at a young age. My kids literally learned to always save 20% before they learned to tie their shoes.

    Unfortunately, I am also now learning that just because they know or understand the concepts of sound money management, this does not necessarily translate into the behaviors we envisioned. One kids is a natural saver and puts away more than we suggest. The other will save only what he is forced to and lets the rest burn a hole in his pocket. arrrggg.
    .-= LeanLifeCoach´s last blog ..Money and Loyalty =-.

    • @Lean Life Coach – I see you’re frustration. Even if you teach your kids about finances and credit, it doesn’t mean they’ll take that information and apply it! At least you’ve discussed this topic with them, in contrast to my friend at work who never said anything to her daughters about taking care of personal finances. As for the age levels, this is just my opinion based on the students I teach. Parents have an advantage since they can work with their kids one-on-one and I didn’t factor that into my age groups. Thanks again for your comment!

  3. @Ingrid – Perhaps you’re right. You could probably push those ages back by a couple of years. I’m basing these ages on the students I teach in elementary. Maybe parents have that one-on-one advantage, as a whole group I see my current 9-year old students having difficulty counting money. So taxes and bills seem a little too difficult for the students I’m familiar with. Thanks for your suggestion, though!

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