MilKids - Tips & Tools to Raise Financially Fit Kids

MilKids - Tips & Tools to Raise Financially Fit Kids

  • Values and Habits

  • Self-Assessment

  • Communication Skills

  • Goal Setting

  • All About Allowances

Financially Fit Kids - Mother carrying daughter on shoulders
  • Systems for Saving

  • Creating a Spending Plan

  • Age-Appropriate Tips

  • Additional Resources

  • Values and Habits

  • Self-Assessment

  • Communication Skills

  • Goal Setting

  • All About Allowances

Financially Fit Kids - Mother carrying daughter on shoulders
  • Systems for Saving

  • Creating a Spending Plan

  • Age-Appropriate Tips

  • Additional Resources

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Values and Habits

Children often model the behavior of their parents, so it’s wise to first take a look at your values and habits with money management and evaluate if you need to make changes.

Do you feel knowledgeable and confident in your current financial situation? If not, consider our Money Ready guide to help get on track.

Have you reflected on your own childhood to see what lessons you might have learned from your parents? What experiences, positive and negative, can you draw from to help get your children off to the right start financially?

First, we’ll help you examine your current situation, then we’ll help guide you through some tips to communicate with your children and assist in creating goals and a solid financial foundation.


You may be feeling very confident in your knowledge and situation to comfortably talk to your child(ren) about money. If so, you may decide to skip this step and read further for some tips to communicate effectively with your child(ren), along with age-appropriate ideas.

If you’re a bit hesitant to dive in, here are some tools to help you get a sense of where you are and how to get started.

Financial Readiness Quiz

Quiz Background Image

Money Personality Quiz

Financial Quiz

Parent Reflections

Financially Fit Kids

Self Survey

Financially Fit Kids

Pro Tip: Sit down and do these activities with your spouse. Determine which habits to change. Set goals and discuss the steps to get there.

What lessons have you learned? What lessons do you want to pass along? What messages do you want to send to your family?

Communication Skills

Did you know most communication is nonverbal? What we say is important but so is how we say it. The goal is to create a trusting environment with open dialogue and a positive attitude, so kids can ask questions, listen, and focus on present and future goals.

How do you communicate with your spouse?

Consider establishing regular check-ins to discuss finances — once a month or each pay period will work. Find what’s right for your family and stick to it.

Accept your financial differences. You are bound to have different values and habits when it comes to money, so learn to communicate well and compromise. Seek professional help when you can’t agree on a middle ground. Financial counselors are available to help for free on your installation.

How do you communicate with your child(ren)?

Money can be a difficult topic to discuss. The key is to have a positive attitude and create a foundation of trust. Be open and honest, and if it is a difficult topic for you to discuss, that’s OK. Give your child(ren) the opportunity to ask questions, listen to their thoughts and help guide and focus them on their goals.

Above all, make sure to keep these discussions light and fun! Incorporate books and games into your conversations about money. Doing so can help your children learn important financial concepts.

How do children communicate with parents?

Kids may want to know why talking about money is important. One of the best ways to explain this may be openly discussing your family spending plan and how you make decisions on needs versus wants. Explain that the family spending plan helps to make sure you are using money to take care of needs, and it also helps you know how much money to save for longer-term goals. Kids thrive in a supportive learning environment. It’s a good idea to start with setting goals.

Goal Setting

Establishing goals is an important aspect of teaching children about money. Talk about things you need now and goals to save for in the future, such as a family vacation or college.

When setting goals, make sure they are SMART — that is, Specific, Measurable, Attainable, Realistic and Time-bound. Learn more about SMART goal setting, here.

Understand that even very young kids are exposed to advertising and peer pressure. Have an open conversation with your children about how they see money based on their experiences at home, with friends, and on social media to help guide your efforts.

The conversations you have with your children will change as they grow, and the whole family can continue learning together!

All About Allowances

First, examine the family spending plan. How does an allowance fit? Decide how much allowance to give and at what age to start. Here are a few tips:

Give the allowance at a specific time. For example, you may decide that allowance is given once per week on Sunday afternoon.

Manage expectations and have clear guidelines that both parents and kids can follow. Decide if the allowance is contingent on tasks like completing specific chores.

Encourage your child to use their allowance to save, spend and share.

Consider a clothing allowance for teenagers.

Encourage older children to negotiate a raise and cite reasons to support their request.

Be consistent. Learning to manage money is like any other task. The more we do it, the better we get at it. Use mistakes that happen along the way as teachable moments.

Systems for Saving

There are many systems families can use with young children to help them begin to understand the concepts of saving, spending and sharing. The key is to keep it simple and age appropriate.

Jar System: Consider giving your child three plastic jars for saving, spending and sharing. Clearly label the jars and help them distribute their allowance into each category.

  • Saving – money set aside for a special occasion or specific goal
  • Spending – money set aside to buy the items we need and want
  • Sharing – money set aside to share with others (family, community, charity)

Clear jars help kids visually see what they have and the impact of saving, spending and sharing. It also begins to teach them to think about the way we categorize money for different uses.

Envelope System: The idea of the envelope system is the same as the jar system but slightly more complex. Kids can add more categories as appropriate. This is a good way to start introducing basic budgeting skills. Many adults use the envelope system to track spending, too!

Savings Account: Your child will get to the point that they have saved up cash and should put it in the bank. For older kids, this is a great time to introduce the idea of earning interest, reading a bank statement, online banking, and preparing a budget, so consider opening a savings account!

Creating a Spending Plan

As children earn an allowance and save money, it’s important to have a full understanding of needs and wants to help prioritize spending. Depending on age, their spending may not be much, but the sooner these habits are formed, the better prepared they should be for the future.

Here are three tips to help your children create a spending plan:

Keep it simple

Use a system (written or digital – whatever works for them)

Get help if needed

This sample spending plan worksheet might help you get started.

Age-Appropriate Tips

The age and developmental stage of your child will guide how you teach them about money. The PDF/chart below gives age-based suggestions for activities you can do with your children. The main idea is to make these activities fun, easy and engaging!

Financial education is a life-long process for children and adults. As parents, we can help prepare our kids to make smart money decisions at every age.

There are many things we can do to continue the learning process. Keep up with current financial news. Visit financial education websites. The age-specific resources listed below are a good starting point to help you learn more about money as a family.

Select the Age of Your Child Below

Additional Resources

Consumer Financial Protection Bureau
This page on the CFPB’s website has information for parents and educators to teach children of every age about finances. There are games, book suggestions, and curriculum resources available.

U.S. Department of the Treasury — Financial Literacy and Education Commission
Games, tools, educational resources, and more are available here.

Military OneSource: Seven Tips for Teaching Teens Money Management
This article has great tips to help teens learn money management skills.

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