Teaching your child money management

From the age of 4 years old, children will begin to figure out and shape their money habitudes. Therefore, it is a great time to start teaching children how to make sense of money when they are as young as 4 to 6 years old. Get started on this journey by using simple activities to help them understand the value of money and develop good financial habits in everyday activities. For example, if your child is a kinesthetic learner (Body Smart), it would be great to introduce money through song and dance as children that age tend to grasp concepts better through physical engagement.

Children 7 to 9 years old begin to understand that you buy things with money you earn, but they are still figuring out the bigger picture of how money really works. One of the biggest steps in financial literacy is not just learning the concept of savings but also identifying the difference between “Needs” and “Wants”. Use opportunities to share, teach, and experience together. For instance, if your child is strong in interpersonal intelligence (People Smart), get them to plan the next family gathering and learn budgeting tips at the same time.

Children 10 to 12 years old should be familiar with managing money and it is a good time to show them how to make good money decisions. To prepare them for the digital world, find ways to let them try out cashless money transactions and digital payment modes. Look for opportunities to allow them to explore their passions at the same time. For example, if your child has high naturalistic intelligence (Nature Smart), you could work with him/her to identify a cause he/she is passionate about (e.g. conservation efforts), and organise a mini fund-raising activity for a charity of his/her choice.