Your child does not yet know his or her times tables, but is he or she already destined to die broke? According to a 2013 study by Dr. David Whitebread and Dr. Sue Bingham of the University of Cambridge, people set up their money habits by age 7. If this is true, it means parents need to take action sooner rather than later.

Here are five saving tools to get your kids started off right and keep them on track.

1. Marshmallow Power.

In the late 1960s, Stanford University conducted a self-control experiment with preschoolers. They were each placed alone in a room and presented with a marshmallow. They could eat the marshmallow, but if they waited until the researcher returned, they would get an extra marshmallow. The average child lasted three minutes before he or she ate the marshmallow. Only 30 percent were able to hold out the 15 minutes it took for the researcher to come back. Follow-up studies in the following decades showed those who delayed had better SAT scores, higher educational attainment, and greater life success. But don't despair too much for the kids who just can't wait for the second marshmallow. The follow-up studies showed many of them have been able to gain better self-control later in life, but as parents you can point them in the right direction now. Try the test with your kids and teach them the benefits that come to those who wait.

2. Child Labor.

Put your kids to work and pay them for it. Kids as young as 3 can be taught to pick up their toys. As they get older they have the capacity to do even more difficult tasks (at least until they turn into teenagers.) You don't need to pay them for every task they do, but you should give them work responsibilities that they are expected to do every day. It's a good way to teach your kids some four letter words like WORK, JOBS, and DUTY. In our house, our children don't get paid for keeping their rooms clean, helping with meals and clean up, or yard work. However, we do pay them for keeping the rest of the house clean. We have divided our house into zones and each child is responsible for cleaning his or her zone every day to mom's standards. You decide how much money your family budget can afford for this teaching opportunity. Even households with super tight budgets can use this system without using money by using homemade coupons instead (such as "Sleepover at Grandma's," "Date Night with Mom," or "Dad Does Your Dishes.)

3. Spending, Saving, and Giving.

Kids under age 5 should probably be paid right away so they see the immediate results of working. Put the money in a glass jar so they can see their money grow. Older kids can wait to get paid when you do. Personal finance expert Dave Ramsey recommends a 40-40-20 budget for kids. This means kids can spend 40 percent of what they make (as long as mom and dad do not object to their purchase.) The kids also must save 40 percent of what they make to be used for a long-term goal such as summer camp or a bike. The remaining 20 percent is for giving. This helps children, who are naturally self-focused, look to the needs of others. Whether it is using their giving money to buy birthday presents for siblings or giving money for the local food bank, teaching children that they can make a difference by always giving to others is a great lesson to learn early on.


With your kids, it is really What You Do, Not What You Say. If you don't wear a seatbelt, then chances are neither will your kids. The same goes with eating your vegetables. Like father, like son. Like mother, like daughter. If you have 20 credit cards in your wallet and you pay minimum monthly payments, don't expect your children to do differently. Talk with them about how you are saving for emergencies, retirement, college, and other long-term needs. Here are some more tips on teaching children the value of money.

5. Games to Save the Day.

Some surveys show that kids play up to 15 hours or more of video games each week. Most parents would like to see their kids spend less time playing games, not more. After all, what is the long-term benefit of launching birds at pigs? However, you should be aware that there are some games out there specially designed to teach kids about handling money. For example, my employer, Zions Bank, teamed up with the nationally recognized nonprofit "Doorway to Dreams Fund" to promote their award-winning online financial education games. Children can play and learn how it is important to pay off debt quickly and invest for the future (and keep the killer rabbits at bay). They can play and learn how to spend money wisely or foolishly by acting as the personal manager for a spendthrift celebrity. The award-winning games are both entertaining and educational so this is the type of video game that parents should encourage. These free games are available at

Parents naturally want the best for their children. If we can pass on good savings habits, we set a great foundation that our children can build on to become financially stable and successful adults.

Close Ad