Summer's Here:
Fun Ways to Teach Kids About Finances at Home

Financial education for kids from pre-kindergarten to 12th grade is important for developing a healthy relationship with money. Teaching them concepts at a young age will build their confidence, critical thinking skills, and problem-solving strategies. What better time to introduce your kids to financial concepts than summer break? Explore key ideas like budgeting, saving, buying choices, planning, and debt with these fun activities and talks at home.

Money Basics
Introduce your kids to the basics of currency, including the different types, value, associated risks, and how it can be used.

Pre-Kindergarten to 5th Grade

• Have them count and sort fake or real bills and coins to familiarize them with identifying and assigning a value to each. Playing games like Monopoly or Life is a fun activity for doing this.
• Playing “pretend” grocery shopping, hair salon, or toy shopping to teach them how to use money and introduce them to different values of money. Write out price tags for the various items so they can connect the prices with the dollar values. For example, gum can cost $1.25, while a frozen pizza might cost $10. 
• Give them fake or real money to spend on small toys or snacks. This allows them to practice counting, saving, and setting savings goals so they develop the skills for budgeting.

6th to 12th Grade

• If you give your kids an allowance, ask them to set aside a percentage of their money for the house's "taxes." Explain how people use this money. It can range from electricity to school supplies to shared household snacks. Whether you choose to actually use it towards those things is up to you, but this will introduce them to the concept of what taxes are.
• If your child has a part-time summer job, walk them through the different tax withholdings and their meanings (e.g. Social Security, state and federal income taxes, Medicare, and disability). You can also have them create a budget based on their projected net income to introduce them to gross income vs net income planning.
• Introduce banking to them by opening a teen savings or debit account online.
• Online security practices are important to learn for anyone banking online. Have them come up with suggestions for safe passwords to use in online banking.

Financial Planning and Budgeting
Help your children find ways to earn money at home. Give them opportunities to practice planning, budgeting, and being responsible with money.

Pre-Kindergarten to 5th Grade

• Whenever they receive money, have them prioritize and divide it into three categories: savings, spending, and giving.
• Give them a way to earn money. This could be an allowance or starting a small business. For example, they could run a lemonade stand or sell baked goods at a family gathering. 
• Have them set an earning goal, purpose, and timeline. Then, provide them with ways to earn money by creating a menu of optional tasks around the house that are worth different earning amounts. Help them develop a plan by using age-appropriate budgeting templates and periodically check in with them.

6th to 12th Grade

• Teach them how to distinguish between wants and needs by letting them help you create a grocery shopping list based on your budget. Then take them shopping to buy what's on the list, allowing them to add in extra snacks if possible with the goal to stay within budget.
• Explain the 50/30/20 rule and have them allocate 50% of their money to needs, 30% to wants and any incurred debt, and 20% to savings. This would be a good opportunity to explore what debt is, if you haven’t discussed it yet.

Saving
Learning about saving money early in life builds a sense of financial responsibility. Whether your kids are saving for a new toy or a new car, the lesson will last a lifetime.

Pre-Kindergarten to 5th Grade

• Let them select or create their “piggy bank” DIY style and discuss all the ways they can save. This will reinforce their savings goals and make it a fun activity for them.
• Open a free, age-appropriate savings account to introduce your child to the world of banking. Take them with you to deposit their money at an ATM or branch so they can experience it firsthand. Show them how to track their savings in digital banking. It’s a fun and easy way to see their money grow and learn the value of saving.

6th to 12th Grade

• Discuss the various types of savings accounts available, the minimum deposits and the rates each account can earn. Starting with the amount the child has available now, calculate with them how long it will take to get to the next savings tier if they continue to save and earn interest. If you can, consider opening a high-yield savings account or certificate. Show your child that regular deposits and compound interest can help money grow faster over time.
• An emergency fund is essential for financial stability. It covers unexpected expenses like car repairs or a sudden job loss. Help your teen calculate how much to always have set aside for emergencies based on their living expenses. If they don’t have bills yet, use anything they feel is a necessity, such as movie tickets or buying extra clothes. Most financial experts suggest saving three to six months' worth of living costs.

Whether you incorporate a more open dialogue about money or plan some real-world exercises for your children this summer, it’ll be invaluable to their financial success in the future. Take advantage of the relaxed summer routine and introduce basic concepts like budgeting, saving, and spending. Financial education at home will give your kids the confidence to make smart money choices for years to come.

Veronica Balderas Financial Coach

About the Author With over 15 years of experience in the financial services industry, Veronica Balderas is a certificated financial coach who helps individuals learn techniques and gain knowledge to manage their finances. She works with members who want to tackle debt, build savings, and create budgets. For the past five years, Veronica has provided members with the tools to create personalized financial plans that align with their goals. She offers information regarding budgeting, savings strategies, and spending plans to help members stay on track for long-term financial stability. Whether you're working to pay off debt, improve your credit score, or navigate a major financial change, Veronica provides practical advice. She focuses on building financial literacy and attacking complex challenges. Her hands-on approach ensures members are able to gain a better understanding of their finances and a clear plan for the future.