In many ways, moms are best positioned to give their kids lessons about money. After all, as Parenting Squad managing editor Rhonda Franz points out, mothers are often the decision makers when it comes to household purchases.

And while Mother’s Day may be the day we try to give back to our moms, the fact is, a mother’s work is never done – not even when it comes to teaching her kids personal finance.

So in celebration of this Sunday’s holiday, we asked Franz how moms can best coach their kids on money.


What advantages might Moms have when it comes to teaching kids about money?

Women in their 30s and 40s are the buying power for American households, making over 80 percent of the purchasing decisions. Budgeting, knowing how to save money and having that much experience with buying household goods might just give Mom the edge when it comes to financial education for everyday expenses. Women may know more about what things should cost, how much they can save at different stores and when it’s worth it to shop around.

At what ages should kids get financial lessons from their moms?

I think kids can start counting coins in preschool, earning allowance in kindergarten and listening to parents talk a bit about money and buying things (or not buying things) from kindergarten on up. As children head into upper elementary grades and early teen years, children are old enough to understand about saving versus spending, saving up for something big and sacrificing the little things. Teenagers can learn how to budget money, balance a checkbook, work for pay when appropriate and understand debt.

Are there any particular props that are really helpful when moms are trying to teach kids about money?

Use real money when practicing counting money, of course. Also, I think it’s important for children to learn that credit cards mean money is taken out of one account and has to be paid from another account once a month. (They notice Mommy and Daddy swiping that credit card at the store and think the money magically comes from there.) Also, show them the bills you pay and the checkbook you use. It doesn’t have to be formal, just let them know you’re paying from the bank account.

Are there certain personal finance lessons a mom should teach her kids on-site?

The best on-site education, I think, is at the grocery store. A parent could have a set amount of budgeted cash for the trip, then go through the store with her children and start adding up the costs. If something has to be put back, that’s just a perfect example of how we have choices and sacrifices to make in order to avoid spending too much. I don’t think that kids should even see what an ATM does until they’re teenagers, when they have a full and clear understanding that the money is coming from a bank account, and not just that big box.

What are the things a mom should teach her children when it comes to money?

  • The importance of budgeting, saving, sacrificing and working for pay.
  • The kind of impact debt can have.
  • What it’s like to pay for something with interest versus saving up and purchasing it without interest.
  • How much money they can save by starting with second-hand stores.
  • Not to purchase new gadgets when they first come out, and not buying the newest and best of everything.

What kind of money lessons should moms teach their kids? How did you introduce your kids to personal finance?