Talking to Your Children about Money: Saving for Tomorrow Starts Today

Children are our future; there is no denying that. Now imagine a growing community of our future leaders being armed with more knowledge about money and compare that potential to the historical “my parents never taught me about money” generations. If this excites you for your children and your community and let’s be honest, exciting for you, let’s learn how to be comfortable in having these conversations more frequently. 

Here’s a helpful way to get things started. There are five uses of money (5Us): generosity, saving, spending, debt, and taxes. Everything we do boils down to one of these 5Us. To help remember these, look at your hand and fingers. Each finger serves a purpose as our fingers work together to help with day-to-day activities. The thumb, index, middle, ring, and pinky fingers. Five fingers and 5Us.

There are a few interesting storylines in play with this visual. To help understand them, here’s a thought. How we view and use money varies but either way, money is a resource. And resources are intended to be helpful. Resources that are not renewable can also be depleted.  This is why the use of money sequence is important to our lives: generosity, saving, spending, debt, and taxes.


Our thumb plays a key role in our gripping and holding of objects as well as providing support to our other fingers in the form of a counterbalance. Interestingly, it is also the most muscular of all the fingers and also has the greatest range of motion. The first storyline: Which of the 5Us do you feel provides the most “balance” to your life? 

We may not know each other but I’m guessing it’s not debt or taxes. That leaves generosity, saving and spending. As a resource, money has the ability to meet many needs and generosity has a way of not only meeting the needs of others but ours as well. To be generous is to also know that we are choosing the narrative to leverage money as a valuable resource rather than money leveraging us. Landing the plane on this, we encourage and teach our children to share and be kind in their adolescence. How might that teaching benefit our children when it comes to managing arguably one of the most leaned upon resources that we all require for our entire life?  


Next in line is the index finger. Most likely a close second in regards to usage after the thumb. It has several names: forefinger, first finger, pointer finger, trigger finger, and other scientific names. Hence our next storyline, savings in its various forms and the importance it plays in our lives. Saving is the index finger in our analogy. FYI, saving isn’t always about retirement, it’s also about rainy day needs and mistakes made. Let’s use this common example to illustrate. Say there’s a need to repair something at home or on your car and when shopping around for the best option, the immediate response from most is “be sure to connect with your insurance company and let us know how you want to take care of this.” Why is this? Because historically that is the most common path chosen. However, to submit this to the insurance company is to then potentially increase premiums for years to come. Instead, how about a cash discount and the job done quickly. This is just one of many storylines that bode well for the importance of savings. 

While teaching our children life lessons, one of the goals as a parent is to help them grow through various experiences, sometimes permitting them to fail, all while under the safety of our reach. These learnings help them become less dependent upon us and more comfortable and confident in their abilities to tackle life. Learning how to save for the future aligns perfectly with this concept. It helps them (and us) be less dependent on the bank for a loan, to avoid being leveraged by credit cards, to become less dependent upon calling mom and dad while “adulting”, and to use insurance only when it is really needed. Instead of drifting towards the narrative most commonly used, again, let’s help our youth choose their own narrative which could look like instilling vision and teaching preparedness. Instead of high-interest rates, it could be cash payment or being their own bank. Instead of extending oneself on a vehicle, it could be leveraging the system rather than the system leveraging them. 

The key to opening the door to these conversations is relating to their life. Remember they are not adults (yet) and they do not share the same life experiences as you. Having discussions with your children about their future can include topics like cash reserves in savings accounts and how that will be helpful for that new bike they want. It could look like investing in a college account so they can go to college. In which you might hear something like, “wait, what do you mean so I can go to college? You’re not going to pay for my college?!” That’ll be your confirmation to the importance of this discussion. It could include retirement accounts like a 401k and why matching is so important. I mean after all, who doesn’t like free money. 

Talking about the differences between account types and relating that to current events in their life can help them begin to understand the importance of forward thinking. This can encourage them to do their own research and to build healthy practices. Letting them explore these topics on the internet and doing their own research can help them feel empowered while also building healthy study habits. Make sure however that the information they are reading is factual and coming from accurate and reputable sources. Also know that they may want to discuss topics like NFT’s or digital currency, something you may not be attuned with. Remember that it’s the conversation, proximity and comfort in learning you’re seeking. Lastly, remember that just because it is important to adults doesn’t mean it will quickly be received or accepted. Be patient. That is why relating it to their lives is important. Stepping into their world, while using the knowledge you have is extremely beneficial.


To live life requires us to spend money and our spending by percentage is the most common usage of the 5Us. And that makes sense as we all have our cost of living. Hence, in our visual of the five fingers, our spending is associated with the longest of the five fingers, our middle finger. 

Go ahead. Give yourself permission to laugh… 

Now more than ever, it’s so convenient to spend money. With apps being linked to credit cards or bank accounts, subscriptions to everything being the norm, and marketing tactics like “points”, we’re tempted to spend money around every corner. FYI, instilling healthy money habits in a culture geared towards spending will be difficult. Especially as the transition to replace the current perfectly capable gadget with the newest gadget has drifted into our culture right beneath our noses. Our children were born into these now cultural norms to spend and they do not know the difference, yet. But you do and that’s why it’s important to combat this with the relational equity that you have and to use proximity, knowledge, application and time as your tools. 

Spending boils down to needs and wants. And both are important to our lives. The key is balance. Our children don’t understand the difference between a need and a want as everything is a need to them. Accept when it comes to vegetables. Be mindful and notice the things they want as you already know the things they need. Relating this to them with everyday items like vegetables and dessert, water and soda, or study time and playtime. Needs and wants. 

To have a budget as an adult is to manage money but children don’t have money early on. Time and self are often their two primary currencies.

As an adult, budgeting doesn’t mean that you can’t spend money on vacations, trips, hobbies and interests. These are important as you invest in your marriage, children and self. It comes down to how all of the 5Us are working together. We should spend the money needed to take care of our family and self and spend the money that invests in the future of both. We should prepare for the wants in our household by writing these items down and talking about them, planning for them, and enjoying them. This is a sustainable lifestyle and the more you include your children in these conversations the better. Money should not be a taboo subject in the home. Quite frankly, it should be spoken of frequently. Why, because the things we fear most are most often the things unknown to us.    

To spend every dime, leaving little margin for error or the future, doesn’t create a sustainable lifestyle. To save every dime and not live life doesn’t bring balance. To give every dollar and not be able to pay the bills invites an eviction notice. This balance is part of the learning that will help our future generations.


For adults, debt is owing something to another (bank) for something you have in your possession (home). It’s important to remember that until the debt is paid, you don’t own it. 

Debt is the ring finger in our analogy. Debt also coincides with one of the most common relationships we as a culture have with money. Hence the storyline. Irony? Maybe.

To teach debt to a child is to first understand how debt can be helpful and harmful. The concept of interest has no bearing on a child. They do however understand consequences, both good and bad. Start by rewarding your child for activities completed early or done on time. Why, because debt that is paid early or on time, doesn’t come with a penalty. In fact it creates a good credit score and that leads to lower interest rates when borrowing. Conversely, suspend play time for a chore not done or study time not started. This side of the coin is much easier to grasp because when payments are late or not paid, that’s when debtors come looking. Then, watch the results in their body language and listen to their words and voila, there’s your opportunity. 

Children naturally want what they feel is theirs, hence the same reason we teach sharing. In these scenarios the time, actions, and results are theirs and they will naturally gravitate towards the beneficial results but shun the harmful. If that doesn’t relate to life I don’t know what does. 

Over time as money is exchanged for chores or they have their first job, more forms of currency will come, such as more responsibilities, more freedom and money. Each of these will be useful in learning about debt. Another helpful tip is to know how your child/children feel rewarded. Not everyone is rewarded the same. Use this learning to help bolster the good and encourage through the difficult consequences.

Debt can also relate to trust. In fact, that’s basically what a credit score for an adult is. The higher the score, the more faith the lender has in being paid back. And in exchange for a higher credit score, a lower interest rate is given. Both parties win. BTW, an interest rate is simply the cost to borrow money. Hence the reason why lower credit scores come with higher interest rates. There’s a cost inherently related to potentially defaulting on a loan. Use this “adulting” knowledge as a means to be creative in your teaching style. 

Debt is a tough aspect to grasp. Maybe that’s the reason why it’s so common. But tackling it early by relating to your child in a helpful, educational and encouraging manner will benefit them over the long run. Again, it is important to reiterate, that although debt most often comes with interest, debt that is resolved early or timely is often not penalized. There are both good and bad consequences related to debt. Not everything related to debt has a negative connotation.  


Like debt, taxes are difficult for a child to understand. Part of the reason is, taxes don’t play a role in their life until that first paycheck. This is why talking about what taxes are and the role they play is important.

For this topic as well as the other 5Us, it is important to be patient and not bombard them with several pieces of information and/or questions at one time. Instead, a helpful way to talk about difficult subjects is to talk about past learnings and mistakes you’ve made. This will let them know that mistakes will happen, that it’s o.k. to make them, they will learn and recover from them. 

This might also plant the seed for another conversation in the future when their minds are more open to it. A lot of times, we as parents want our children to think like us, but that’s not always possible or realistic. At some point, they will have their own thoughts on money, and you should encourage them to share those thoughts with you. This will open up a good discussion on how you have managed your income and how it has helped or hurt you and your family. It is through these types of conversations that both you as the parent and your children learn. Remember that we all learn at different paces, in different ways, and at different times in our lives. Teaching is a great way to confirm current actions and make changes within ourselves, as well as help others. When teaching kids about money, remember that there is no one-size-fits-all answer – what works for one child may not work for another. What’s most important is that you are there, that you want to hear what they have to say and that you give your parental input appropriately.


Teaching our children the 5Us and how each applies to their lives is not only investing in their future with money, it is investing in their life. Matters pertaining to money parlay into several other valuable life lessons. 

For example, how many BFF’s are they going to have? That’s right, more than one but they won’t understand that when their first BFF is no longer. Relationships require an investment of time and proximity, as do money matters. Learning about compounding interest and how it works with our money ties nicely into work ethic and other trusted attributes. An ongoing investing regimen into our retirement and rainy day accounts requires a plan, much like investing in our marriages. Debt, there are all types of debt instruments that exist, not just fiscal. Emotional, relational and mental debt instruments also exist in our lives and it’s helpful to further understand all of them. Taxes aren’t going anywhere and the more in tune we are with how our income interacts with our taxes, the better. Plus, the more we openly discuss the role taxes play in our lives and communities, the better. Keeping the 5Us on the front burners of life, will yield desired results in you and those closest to you. 

Start small. Plant seeds. Listen. Adapt. Repeat. Tomorrow’s future leaders are worthy of the time. They are capable. They are often more resilient than we give them credit for. And, they are our responsibility to lead.   

Some of the best gifts you can give as a parent are love, insight and time. We’re hopeful this further equips you to provide these and more. We encourage you to keep building your financial goals and keep planning for you and your family’s future.