Money lessons for 6-12 year olds

Toddlers should already know that you need money to buy things and that it is valuable. Read more about the money lessons you can teach toddlers here.

From around 6 years old you can move onto more abstract concepts and teach your child the following money lessons.

  1. When I want something I have to plan for it. Setting a goal to save for something that they want can teach them to budget. Let them handle money and pay for something, plan how much they should give and check if they got the right amount of change. 
  2. You can save your money in a bank account where it will earn interest. Children should know that you can save your money at home or that you can open a bank account and that you will earn interest. It is also important to teach them that there is certain details that you should keep save, like your pin. If they start experiencing with internet banking, teach them about the possible dangers and online safety.
  3. Whenever you get some money, you should save some of it. Teach your child to save at least 10% of any money that they get. It could help if they have a goal or save towards something. To encourage them to save you can match whatever they have saved each month.
  4. The sooner you start to save the faster your money will grow. Talk to them about the principals of compound interest in a way that they will understand. Help them set a long term goal and discuss different scenarios to show them how much they could save by the age of 16 if they put away a certain amount each month. 
  5. Using a credit card costs you a lot of money. Children should understand that a credit card is like taking out a loan and that you will have to pay interest. Whatever you bought will be much more expensive than the original price. Although it can be useful for online purchases, the account should ideally be settled in full each month.