Super Creative Way to Teach Kids About Money

My nephew got a special gift, it was new digital coin bank that counted the money as he dropped the coins in and the total amount in the jar showed up on the little digital panel. He was so excited about this new toy. He would ask everyone for all their quarters because he knew that quarters were worth more. Whether we should be teaching kids about money is not the debate!


The next generation wants to know how to handle money, and it’s our job to make them responsible.


Wouldn’t it be great to help our kids, even the littlest ones, figure out the secrets to financial success before the age of 10?


These days, parents know it’s not enough to teach how to count in multiples of nickles and dimes. We millenials are going to invest in our children’s financial education so much that the next generation is sure to be an explosion of wealthy, money-smart young adults.


Where to begin… with the basics.


The Three Jars Method

It’s almost sad that this whole entire post is dedicated to something so simple.


You can do this method organically (e.g. with three actual jars and a notebook), or you can use the website, which is useful for tracking allowances, paid chores or jobs that your children have done, and even add an interest rate to their savings to encourage more “deposits.” This feature is huge for someone like me who was recently accused of having an acute problem with mommy-fog issues in the memory department. I am forgetful…  Visit the page and sign up! Even though my boy is only 8 months old I signed up and I’m already motivated to start saving for his future!


Think about it. Even if your child is still just a concept on the other side of a bit of rubber, imagine the impact of putting $5 a week in a savings account for them and telling them about it when they’re older.


Let’s go through the method jar by jar.


Jar 1: Savings = 50%.

Of course employing the method before you reveal the kiddo’s saved up riches is always better. We are not handing him money. We are giving him the opportunity to make wise decisions.


My plan is to burn Proverbs 4 into the brains of my children: Listen to your parents!


Let’s keep it simple and go with the 5 smackers a week idea. In this instance your child will be saving 50% or $2.50 a week. That means when he turns 10 years old he will have $1300 in his savings “jar.” If you actually invest these savings (average long term earnings are around 8%) he’d be looking at almost $2000.


Savings are “no touch” by definition and he might be excited, but you will have outlined the ground rules for his savings jar. Savings are for a college education or if he’s a genius millionaire before college, then he can use it for a down payment on a house.


Since the accounts are all controlled by mom and dad, he will only watch the number grow and will thank us when the time comes. I fully expect some push back on this in the future, especially around the time they get their license and they know that money would be better spend on a Mercedes.


Jar 2: Spending money = 40%.

With a deposit of $5 a week from birth to 10 years your little munchkin is looking at 2 bucks of wacky do-whatever-you-want money. This is up to the parents how much guidance you give them on this.


The assumption is that you are teaching them financial responsibility like a boss. They will end up asking, at 10 years-old to buy a telescope or a laptop for school, but maybe they’ll ask for an Xbox.


My brother-in-law’s philosophy is to allow his children to make their own mistakes and spend their money willy-nilly. I’m more of a loose-leash mom myself: create reasonable rules and give them lots of controlled options, but that’s for another post…


Jar 3: Giving = 10%.

As a Christian mom, this chunk makes sense. I will have also taught my boy the importance of tithing (giving 10% of earned income to the church). Since he will know about giving as a little tyke, it won’t be such a shock when we teach him the joy that giving brings when he gives away 260 smackers all at once.


At 10 years old, that will seem like a fortune, so again, I’m prepared for some push back, but this is where we can give him options of how to give it away. Otherwise the money will simply sit in the giving “jar” until he’s ready to part with it.


The cool thing about the Three Jars website is the option to include odd jobs, chores or other earned income besides their regular allowance. This is great if you want to teach them the value of working for your bread.


Kids’ knowledge about money is way more important than it used to be. Teaching them about saving, spending and giving is the jump start your kids could get so they can stay on par or ahead of their peers.


I’m curious how you handle educating your tots about money! Shoot me your experience in the comments below.




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