Raising Financially Fit Kids

When is the right time to start talking to kids about money? That is a difficult question but one every parent should consider.

Last year, my 4 -year old niece lost her first tooth. She was so excited with the idea of the tooth fairy bringing her money. “Auntie, I will have my own money” with a big smile on her face, she said. “Her own money”.

Listening to children talking about their own money has always fascinated me.

What do they really imagine, that they will get money from the tooth fairy; will this be a step towards entitlement?

The following week, she went to buy groceries with her mom. They were in line to pay and suddenly she tells her mom “mom, don’t worry if you don’t have enough money, I have my money from the tooth fairy”.   I don’t have children of my own so I admit it; I love this kid more than anything. But could you imagine a sweeter comment from a child. She is a giver.

That sounds amazing, but what does that mean?

Joline Godfrey has an excellent book I use with all my clients “Raising Financially Fit Kids” https://www.amazon.com/Raising-Financially-Fit-Kids-Revised/dp/1607744082


According to Godfrey, a child who is a giver will have a tendency “to use money to smooth potential conflicting situations….givers have sometimes a hard time saving….”

I don’t want that for my niece!! I want her to be able to solve conflicts without using money and I want her to save and realize she has to start doing it from an early age. I want her to know the basics: save, spend, invest, and giving.

Godfrey mentions other child personalities when it comes to money:

The hoarder, the scrimper, the spendthrift, the beggar, the oblivious, the hustler, and my niece the giver. I’m sure you know which one you have!!

When is the earliest you can start talking to your children about money?:

About five years old. Then is when you have to start using their own words to inject in their little brains the concepts of earning, saving, spending, and giving. Investing will start with children a little bit older, about 12 or earlier if the child has a special interest on it.

But most importantly is the time when you have to talk to them about the values your family share, the values that will be reflected in this circle of earning, spending, saving, and giving. Integrity, work ethics, honesty, giving, courage, risk, compassion, are only a few of the ones that come to mind.

It is the time when they should realize that the tooth fairy would bring money if you lose a tooth, but you need money at other times too, and for that you need to earn it.

I remember when a super smart 11- year old told me, “I don’t have problems, my father is my bank”. Wow!!

They need to know daddy or mommy is not a bank. And yes, they can give their money away if they want, but they will have to realize that means no money for buying the new skate they really want.

They need to start fixing priorities when it comes to money.
In a way you are just introducing the concept of a budgeting

Here are the responsibilities and actions kids between 5 to 18 years old should have according to Godfrey:


Stage Responsibility Actions
Apprenticeship (5-18) Develop financial vocabulary, establish early financial habits and values, practice saving, spending , earning, and philanthropy Manage allowance, hold first job, begin community involvement

Source: Raising Financially Fit Kids, Joline Godfrey


What do you think? When are you planning to talk about money with your kids?


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Finbliss team

It’s your financial life. Embrace it. An educational community of financially aware women helping, supporting and guiding one another.

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