Teaching Your Kids About Money


Good day, CNA Finance friends!  Joshua has been kind enough to invite me to share some of the reasons that teaching your kids about money is so very important.  I’ve recently released a short but powerful e-book on the subject, called How to Teach Your Kids About Money, and I’m here today to share why I think it’s so important that parents make a concerted effort to educate their children in the area of personal finance.

My husband and I grew up in the era when money, on a personal level, was a taboo topic.  When I was a kid, very few kids (or adults) knew how much money their parents made, saved, or spent.  Debt was also a private subject that you didn’t share with your kids.  I believe that this mindset ushered in a bit of an age of ignorance about money.  What you don’t know can’t hurt you, right?  So why not spend freely until your heart’s content?  After my parents’ divorce, I still didn’t know much about either of their money situations, but as often happens after divorce, both my mom’s and my dad’s financial situations declined.  We went from making ends meet to struggling to buy food and keep the electricity on.  It was not pretty.  I was occasionally teased by classmates for being a poor kid, and I didn’t like it.  Because I was never educated on money, I thought that the problem was that I didn’t have enough “stuff”, so when I got my first job at 15, my only goal for my money was to make sure that I had the stuff I needed to fit in with my peers.  What followed was a relentless chase to keep up with the Joneses.  My husband, on the other hand, also had fears about money due to it being a taboo topic in his home.  His father often gave him incorrect messages about their money situation that promoted huge amounts of fear in him, and as a result, he never wanted anything to do with managing our money or even knowing how much we did or didn’t have.  As you can imagine, our two misguided mindsets about money were a terrible combination.  After being married for 16 years, we finally realized that we had to get a grip on our financial situation, and after adding up the numbers, we realized that our debt had grown to dangerous numbers.  We soon made a plan to get out of debt, and are now fervently working to finish that plan.   In the process, we’ve also made a commitment to teach our children about how money works, so that they (hopefully) won’t make the same money mistakes we made.

Why It’s So Important to Teach Your Kids About Money

Whether it seems surreal at this stage or now, your children will one day make their own money, and as such, will need to know how to handle it.  As I look at the adults in the world around me, I see a few different camps.  There’s the “We’ve got a healthy outlook and plan for our money” camp.  There’s the “living paycheck-to-paycheck but making ends meet” camp.  And there’s the “we’re always struggling for cash” camp.  Which camp do you want your children to be in?  Do you want them coming to you every month, asking to borrow money “just until Friday”, or do you want their money situation to be one of peace and security because they’ve learned how to manage their income – whatever it is – well?    Poorly managed money will bring your children a number of avoidable stresses, where proper and healthy money management will bring them peace and the ability to make choices based on what’s best for them as opposed to what their money situation dictates.

One of the very best gifts parents can give to their children is a healthy knowledge and understanding of how money works.  Choose today to give your kids that gift, and educate them on the ins and outs of healthy money management.

What were you taught, if anything, by your parents about money when you were a child?

Laurie is a wife, mother to 4, and homesteader who blogs about personal finance, self-sufficiency and life in general over at The Frugal Farmer. Part witty, part introspective and part silly, her goal in blogging is to help others find their way to financial freedom, and to a simpler, more peaceful life.

Awesome Posts From Around The Blogosphere!

In spirit of leaving you with more great reads, here are 2 of my favorite posts done by Laurie about teaching your children about money…

Teaching Kids About Money: How To Prepare Them For Adulthood – Just in case you didn’t know, not only does Laurie own her own blog, The Frugal Farmer, she’s also a major player over at Frugal Rules. In this Frugal Rules contribution, Laurie shares great tips for preparing your children financially for success!

How To Include Your Kids In Budgeting Sessions – Budgeting is incredibly important as we grow up and become financially responsible for ourselves. In this guest post on Mom and Dad Money, Laurie shares great ideas for getting your children involved in budgeting!

Know of any other great posts by Laurie? Let me know about them in the comments…I’ll even approve links to them!


  1. I read posts by Laurie all the time as I’m a daily reader of her blog and some of the blogs she writes at regularly. I don’t have kids but I definitely want to teach them about money, finance, and business from a young age. I think it’s still a pretty taboo topic to talk about within families and the kids who get that informal education from their parents are the ones who have a leg up when they hit the real world.

    • “the ones who get that informal education from their parents are the ones who have a leg up when they hit the real world”. This is my goal in this area for children, DC, as it is Shannon’s from The Heavy Purse. We have to stop sending our children out into the world completely ignorant of how to manage personal finances. We owe them more than that.

  2. Being upfront with your kids about money, teaching them the ins and outs of how it works is great. Unless, I think, you have real money problems. I’m not sure it is good to share your anxiety with them. I think they deserve to feel secure in their environment, in their home. That learned security is also an important life lesson. Keep the lessons abstract I guess and some of the realities to yourself.

    • Great point, Brad. We shared our real money problems with our kids a year and a half ago, but didn’t tell them too much, except for to say that we had serious debt, and that it was important that we work to get it paid off immediately. We made sure to let them know that we weren’t in danger of losing the house or anything, but we did let them know that it was a situation that warranted our immediate and serious attention. Because we didn’t panic, they didn’t panic.

  3. I didn’t learn too much about money management from my mom. The one main theme I always remember was to be responsible for your debts. She borrowed small loans from the bank and she always made sure to pay them off on time.

  4. It’s so important to teach by example when it comes to teaching kids about money. I also believe in being very open with kids about your finances (age appropriately, of course) and letting them know how much your bills are and take them through the steps of handling your finances.

  5. I learned about money management early on in my life – and I think that learning about it at such a young age made a BIG impact on me. At home, my parents mostly taught me to save first, spend later. And to always avoid debt – this was helpful for me when I went to college and had to make decisions about how many students loans I would borrow. I ended up doing quite well on that front: came out of college with a balance MUCH lower than the average college grad and I think a big reason for this was learning about the dangers of debt at such a young age from my parents. Great post, Laurie!

  6. I love Laurie and actively follow her blog and she recently wrote about the extreme things that she and her family have done to save money while getting out of debt. She made me want to make my own laundry detergent. I didn’t even think that was possible!

    • LOL, you’re funny, Shannon. 🙂 Thanks so much for the kind words. I love that I get to work along side you in this virtual world of educating people about money. It’s awesome, and your commitment to helping others in this arena is always inspiring, Shannon. 🙂

  7. Do you think it’s better to have great financial advice to follow or have terrible financial advice to stay away from forever?

    An example would be following in Dad’s footsteps to Harvard vs living in the projects doing everything you can to get out and make it to Harvard.

    • I would say you’re better off having great financial advice to follow. Having grown up in poverty, and observing the others that grew up in our neighborhood, I would say the majority of them went the way of following in their parents’ footsteps of managing money poorly. Now that I have a different crowd of friends, most of them who have wealthy parents (self made) have followed in their parents’ footsteps of working hard to save and stay out of debt.

  8. I’m a fan of including your kids in your finances. Showing them your budget and letting them learn from you. If you’re in a lot of debt, they can see how bad it is. If you are successful at investing, they can see the positive. I don’t they should be in the dark. They’re your children, not some stranger, let them in on your business! Thanks for the post!

  9. Really a thoughtful article. No matter whether you are a rich parent or a poor one, it’s always better to teach your kids about money so that they can manage their finance properly and protect themselves from getting into debt trap. Afterall prevention is always better than cure.

  10. Great article. I couldn’t agree more with the sentiment that we need to do more for our children in terms of financial education. It did wonders for me having parents that did see the value in doing so.


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