The Importance of Teaching Your Kids How to Manage Their Money


A child with her iPhone.

Madelaine Patricia

In today’s world, more kids are being given larger amounts of materialistic items such as phones and other electronics at a young age. When kids continue to have things handed to them whenever they want, they never gain an understanding of the fact that money doesn’t grow on trees—and by the time they’re on their own and have a job, they have no clue how to manage their money, which can be dangerous.

Unfortunately, money management isn’t something we learn in school, so it’s up to parents to teach their kids how it works. One way to do this is having kids and, more importantly, teenagers do chores around the house or help out in some other way in return for a weekly or monthly allowance of a small amount. This helps kids understand that you work hard for your money, and once they have it, they figure out how to use it. They then realize that, when it comes to money, you have to be smart—watch your spending, save, and prioritize.

It’s a huge responsibility to go from living at home with most things taken care of to dealing with the many kinds of payments and costs of life as an adult, and it happens fairly quickly. When kids and teens get the experience of managing their money, they’ll understand and be prepared to be on their own for the rest of their life, with a decreased risk of financial troubles down the road.