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Age-by-age Guide: Teaching Money Concepts

There is a correlation between adolescence & adulthood in terms of financial habits. Start to teach kids money now with our guidelines!

It is proven that there is a correlation between adolescence and adulthood in terms of financial habits. You wouldn’t want to regret when kids' bad financial habits have ‘plastered’ and become hard to break! Stick with this general guideline, you'll be off to a great start. 🤗

Age 3-5:

1. Teach the concept that money is a medium of exchange.

2. Explain the difference between 5- and 20- cents, half-dollar and 1-dollar.

  • Small Activity: Give your child a mix of coins and ask her to count how much money there are. Or, give an amount and have him practice picking it out of a pile!

3. Teach needs versus wants through interactive approach.

  • Small Activity: Use this wants vs needs learning pack. It is normal for little kids to grab everything that looks enticing to them in malls, it's your chance to explain that "money doesn’t grow on trees”! The next time your kid sees multiple things he wants, make him choose just one.

Age 6-8:

1. Start providing a weekly allowance. This is when kids start to grasp money values, so help them learn through a practical experience.

  • In the process, institute a three-jar system to break their allowance into savings, spending, giving. You could supervise their way of allocation, but please let them decide how much should go into which jar!

  • E.g. If they finished all their savings on impulse buying and ran out of money, do not give them more! Then, they will get a valuable lesson on budget allocation, keeping track of their money and the importance of savings for future use.

2. Explain what bank accounts are and how bank accounts earn interest.

  • These money conversations are essential to provide them a first-hand understanding of how money works, therefore encourage good money habits that will last a lifetime.

3. Assign chores to earn extra allowance. Read our blog post on assigning chores to allowance!

Age 9 - 13:

1. Bring your kid to the bank to open a savings account. Teach them how to read their bank statements too.

2. Motivate child to set saving goals & work towards it, e.g. a bike/ a book.

  • They will enjoy the feeling of pride and independence in making their own purchases without any help from dad and mom! 😎

3. Discuss the importance of giving back to society. 💓

  • The richest people such as Warren Buffet and Bill Gates give a portion of their wealth to charity, take them as role models! Talk about what’s meaningful to them, like animals, the environment or other causes, and how much they’d like to commit.

4. Teach them to be smart purchasers.

  • Small Activity: While shopping, compare a cheap product and an expensive alternative. Show the different prices for similar items due to branding, difference in quality, comparing deals and discounts, and explain why your choice!

  • Bottomline - Price isn't always the determining factor, the key is to choose smart purchases rather than just the cheapest.

Age 13-15:

1. Expand your child allowance to a monthly basis.

  • Change allowance system when they learnt to manage money well. Increase the amount so that they will be responsible for more expenses, e.g. phone bill and transportation.

2. Introduce entrepreneurship. 💡

  • There are so many ways kids can earn extra money, it can be as easy as walking their neighbour’s dog! Do talk about savings for their own college education too. 🎓 🏫

  • Small activity: Involve your kids in planning and budgeting for a family outing or a birthday party. Let them plan the costs, including transport, food or tickets.

Age 15 - 18+:

1. Explain debit and credit cards.

  • Using a debit card means deducting money from your bank account.While swiping a credit card equals borrowing money - if you don't pay it back on time, they'll charge you extra!

2. Teach them how to manage their account through their phones and Internet banking applications.

Key Takeaways:

When kids grow up in a family where money conversations were regular, and they were taught how to make financial decisions wisely, they will become money-savvy while stepping into adulthood. Cheers to wise parenting! 🥂

Mellow - Your kid's best money app to budget, save, earn & spend. Now available on App Store‎ and Google Play


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