Some money things to teach your Under 12s and Tweens

29 June 2016
Teaching your kids some simple money lessons can help to smooth out potential money hurdles down the track. Here are a few things to teach your kids and tweens before they hit their teens.

Money when they’re young…

  • Make money visible. In this era of Eftpos, online shopping and contactless payment, it’s easy to not use cash for a week or more at a time. Without the visibility of cash, young children may not be aware that what you buy costs money! Try to use cash whenever possible when you take your children shopping.
  • Start pocket money early. The first year or two of starting school, with the attendant jump in cognitive development, is a great time to start the routine of earning pocket money for chores. The concept of work = reward is a priceless lesson to learn. (And according to CommBank’s 2016 Common Cents study, the average Aussie kid starts receiving pocket money at age 6.4 years, so your kids’ friends will be doing the same thing.)
  • Start a savings habit. Whether you utilise a School Banking program or a piggy-bank on the shelf, encouraging your child to deposit a portion of their weekly pocket money into a savings account will introduce them to the idea of regular savings.
  • Allow them to make choices. Children learn very effectively by doing! Choosing how to spend their pocket money is a great way to teach them about the “opportunity cost” of money. This means when you choose to spend money on one thing, you lose the opportunity to spend that money on something else.
  • Make it fun. Money games are useful at this age, and many of the financial institutions we research and rate for the Junior Banking Award have on their website fun and educational games that teach kids about money and how to use it.


Money as they get older…

  • Help them set savings goals. Whether it’s a 1 month, 6 month, or long-term savings goal, having a particular item to save for really helps kids to understand budgeting. Your kids now understand the concept of money and budgeting and now it’s their turn.
  • Introduce them to the concept of Eftpos. While younger children need the visibility of cash, older children can begin to grasp the concept of Eftpos and electronic payments using a debit card.
  • Involve them in family budgeting decisions. While your kids don’t need to know the minute details of your family budget, involving them in some family budgeting decisions is a great way to reinforce that “opportunity cost” message. Which extra-curricular activities are affordable? How much will a family holiday cost? Helping to weigh up the options and decide the outcome can be a great learning experience for kids, as well as give them a sense of ownership in relation to the outcome.
  • Don’t pick up the tab for overspending. The tween years come with great spending temptations as kids are now ready to learn what is perhaps the most important lesson of all: living within their means! iPhones, iPods, iPads … this is an “I” time of life for your children and their spending wants may accelerate significantly. Whatever you do, do not give in to pester power and do not pick up the tab for any technology-related overspending. Tough love? Yes. But “living within your means” is a far better lesson to learn at this age, while the stakes are still low.


Learning about money is a life-long activity. Encouraging your children to take an interest as early as possible and to approach money issues with a positive attitude will hold them in good stead right through to their retirement.


Source: ASIC’s MoneySmart

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