Bruce Helmer and Peg Webb
Parents spend a lot of time thinking about how to prepare their children for adulthood. We talk about education, character, and work ethic, but money often gets pushed to the side. That’s a mistake. How children observe and experience money early on can shape their financial behavior well into adulthood.
The good news is that teaching kids about money doesn’t require complex spreadsheets or long lectures. In fact, some of the most effective lessons are simple, practical, and woven into everyday life.
Start early, keep it simple
Money lessons can begin earlier than many parents expect. Toddlers quickly learn about waiting, choosing, and tradeoffs, all core ideas behind saving. A clear jar or piggy bank lets children see money accumulate and introduces the idea that saving has a purpose.
Just as important is helping kids feel comfortable with their family’s financial reality. Teaching contentment and perspective early on can reduce unhealthy comparisons later.
Introduce real-world money tools
Opening a basic bank account is often a child’s first hands-on experience with money management. It creates a natural way to talk about deposits, withdrawals, and keeping track of balances.
As kids grow into their teens, saving for larger goals such as a car or travel helps connect effort and planning with outcomes. When they’re ready, conversations about credit should focus on discipline: using credit cards for convenience, paying balances in full, and avoiding purchases they can’t afford.
Why financial literacy matters
Teenagers overwhelmingly say financial knowledge is important to achieving their life goals. At the same time, many struggle with basics like budgeting, saving, and using credit responsibly. While more schools are beginning to offer personal finance classes, many still don’t. That leaves parents as the primary and often most trusted source of financial guidance.
That role matters even more today, when young people often turn to social media for financial advice. Some of that content can be helpful, but much of it isn’t. Families who talk openly about money can help their kids separate realistic guidance from fads.
Let teens earn their spending money
Part-time jobs teach lessons that allowances can’t. Earning money builds confidence and independence, and it helps teenagers understand how much work goes into maintaining a lifestyle. That awareness often leads to better decisions when they’re managing money on their own.
Teach common-sense budgeting
Budgeting is easier to learn before the stakes are high. As teens approach college or independent living, parents can walk them through managing a checking account, paying bills on time, and understanding monthly expenses.
Sharing examples from your own household helps make these concepts real, such as showing your kids what it costs to run a car, pay utilities, or buy groceries. It also introduces the idea that every financial choice involves tradeoffs.
Introduce investing without overcomplicating it
Long-term investing can feel abstract to young people, but the basics are approachable. Explain what stocks and bonds are, why diversification matters, and how time can work in an investor’s favor.
As kids get older, reviewing account statements together or tracking progress toward a goal can help them understand how money grows, and that risk is present in all investing.
Be thoughtful about offering financial help
Supporting young adults financially doesn’t always mean stepping in immediately. Making and learning from mistakes is often part of becoming financially independent. While every situation is different, repeated bailouts can delay that independence, however well-intentioned the effort.
Set realistic lifestyle expectations
Young adults starting out won’t live the same lifestyle they grew up with. Smaller apartments, tighter budgets, and different priorities are normal parts of early adulthood. Helping kids understand that reality can reduce frustration and build confidence.
Above all, be honest in your conversations
Teaching kids about money isn’t about having all the answers. It’s about starting honest conversations, offering guidance along the way, and modeling healthy habits. For families facing more complex decisions, a financial adviser who understands your values can be a helpful partner in preparing the next generation for financial independence.
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The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
Bruce Helmer and Peg Webb are financial advisers at Wealth Enhancement Group and co-hosts of “Your Money” on WCCO 830 AM on Sunday mornings. Email Bruce and Peg at yourmoney@wealthenhancement.com. Advisory services offered through Wealth Enhancement Advisory Services LLC, a registered investment adviser and affiliate of Wealth Enhancement Group.
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