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What Are the Best Financial Education Tips for Children?

On October 31, World Savings Day was celebrated, with the aim of raising awareness among the population about the importance of having a good culture and financial education. If you are wondering how to instill good financial concepts in children, here are the guidelines to follow.

While no one is born an expert in the subject, around 93% of children learn financial skills from their parents; However, they are often not healthy or best practices for the world we live in.

“Many families tend to live beyond their means because they are unaware of good financial practices. This usually results in little savings, limited options and even bankruptcy,” comments author Elaine King. As consumer culture continues to grow and dominate financial spending, more and more people are becoming vulnerable to failure in this area.

How to encourage the savings habit

For children, money must be earned through a combination of completing tasks and positive reinforcement (rewards). Therefore, the personal finance expert recommends the following four practices to promote a responsible financial culture that should be done consistently and continuously at home.

  1. Teach the value of money and delayed gratification. We are born with an inherent drive to react without considering long-term consequences, so it is necessary to explain to children the value of patience, explaining the definition of delayed gratification. It is also important to learn how to earn money in order to truly know its value, there are creative ways in which you can demonstrate this by doing daily tasks at home. For example, when your child asks for something, teach her the concept of waiting by using a stopwatch for a short period.
  2. The importance of having clear savings goals.To be effective, savings must have a clear, measurable, achievable, realistic and specific goal, with a specific time frame. The idea is that you should save before spending, with an assigned percentage. For example, write a savings goal with the child for something they specifically want as a game. Consider some incentive for meeting goals, such as helping them with some of the value saved so that it arrives faster if they meet their savings.
  3. The difference between saving, investing and generating money.By saving a little at a time and investing wisely, money can grow significantly with compound interest. The message to convey is: Put your money to work! Children from an early age should know the value of entrepreneurship and how to have savings with a clear purpose.
  4. Protect money and share it.Sharing time and resources with the community turns out to be an invaluable experience for young family members, because it demonstrates the positive impact they can have on the community at large, and the efforts of their limited resources. For example, in Elaine's upcoming book“Saltarín learns to use his coins”, The character helps his village in a sustainable way, so the child can learn to think about solutions with greater impact.

Second finance book for children

A good story is an excellent way to reach the little ones and teach them about the importance of saving, responsibility and teamwork (family finances). In this second publication, Jumper has grown up and is now responsible, can spread his wings and fly on his own adventures. Therefore, he undertakes a long journey through Kodiak in Alaska, Yucatán in Mexico and the Amazon in Peru, where he will learn important lessons from new friends.

In this way, Saltarin will discover how to save with purpose, how to undertake work as a team and impact, and how to share his learnings so that his entire community benefits. “In this second book I want to convey the importance of transforming financial education into something practical, habitual and entrepreneurial for the sustainability of the future of children in the world," she concludes. Elaine King.


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