There’s no question about it: money is an essential resource in every stage of our adult lives. We need it to fund our survival, as it helps pay for the food on the table, the roof on top of our heads, and everything we need to maintain a comfortable life.

Given the importance of money, it’s a crucial step for parents to impart their financial knowledge to the next generation. This will help set the foundation for your kids to develop a healthy relationship with money—which will be a major help throughout their teen years and adulthood.

That said, teaching financial literacy to children the “old-fashioned” way may not be the most effective way of going about things. Core financial concepts may fly over their head, leaving them scratching their heads in confusion and not learning anything.

The best way to teach children about finances is to do so in a fun and engaging way. If you’re looking for ways to instil the value of money in your younguns, here are seven fun ways you can teach your children about finance.

Let’s begin!

1. Use a Transparent Jar to Show Progress

An effective way of teaching your children about finance is by giving them a savings jar for them to put money in. 

Experience is the best teacher—and having your child drop bills and coins that they have saved up into the jar can be a very fulfilling achievement. This is because the money growth is tangible and visual, which is in stark contrast to traditional saving methods like putting money in a bank account.

As your child continues to consistently save up in this way, you can teach them about how growing that amount can mean great things. It can turn previously unachievable goals (like buying an expensive toy) into something real. 

You can also connect the concept of saving in a money jar to saving in real life, that is, putting money consistently in a bank account. Or instead of going the full-on practical route right away, you can also teach them about the benefits of delayed gratification and patience.

By allowing your child to save through a dedicated savings jar or piggy bank, you’re playing a role in setting them up to be planning goal-setters later in life. Click here for tips on how to simplify financial learning for your child.

2. Conduct a Family Challenge

Another fun way to motivate your children to be smart with money is by turning the act of saving into a friendly competition. The added social and competitive element of saving together can provide a good motivational boost to your child.

There are many challenges you can consider setting up for your family. For instance, you can host a simple challenge with your children on who gets to save more of their allowance in a given period. Alternatively, you can set days of the week into “no-spend” or “low-spend” days.  

The winner of these challenges should ideally get a reward. A simple reward like some praise and a sticker on their name on a blackboard can do, but of course, this will vary depending on your child’s wants and your own means.

The more family that joins in on the challenges, the better. Conducting a fun-spirited challenge with your children can help them mirror positive financial behaviour—especially if you’re joining in on the challenge as well. This, in turn, can help them create a good outlook on finances.

3. Go Budget Grocery Shopping With Them

Taking your children out to do grocery shopping with you may seem like an unnecessary burden. But instead of seeing it that way, think of it as a good opportunity to teach them how to budget wisely. And it can be a neat little challenge for them too!

Start by giving them a budget to work with—around $100 would suffice, but adjust accordingly.

Then give them a list of general items you want to purchase. Afterwards, let them pick the items based on the needs listed in the shopping list. The only catch is they have to keep it below your marked budget.

Of course, it’s a good idea to accompany them throughout the process and teach them to make smarter choices. If they choose an expensive item, then lead them to the more practical and inexpensive substitute.

By being hands-on, your children can learn how to make practical financial decisions. They can carry this skill throughout their lives, making it easier for them to manage money in the future.

4. Entrepreneurial Roleplay

If you want to improve your child’s entrepreneurial acumen, then consider engaging in a fun roleplay session with them.

Encourage your child to play the entrepreneur or business owner, and you play the mock customer. You can switch roles too as you see fit. Guide them through the process of setting prices for their products, talking with suppliers, and marketing their products out to the world. Then, you can engage in mock situations that can test your negotiation and business skills.

Engaging in roleplay is a fun way for children to expand their perspective on different topics and scenarios. It gives them a glimpse of how different people may engage and react with them in a professional setting, granting a safe environment for them to experience real-life situations and solve problems.

Roleplay allows children to practice their cooperation, conflict resolution, and problem-solving skills. It can also be fun if everyone gets into it, so consider doing it regularly to help your child enhance their perspectives.

5. Organize a Garage Sale or Lemonade Stand

Want to truly teach your child about real-world finance? Then let them do the work by encouraging them to set up a garage sale or lemonade stand.

Unlike roleplay, organising either of these activities is the real deal. It’ll give them first-hand experience on how to deal with customers, negotiate prices, and practically apply maths by calculating profits and losses.

Furthermore, it also helps them operate a business in the most fundamental sense. This can be a confidence booster and provide a wealth of experience in a fun and fulfilling way for the kid.

6. Play Financial Board Games

If fun is the priority, there are many financial board games that you can play with your children. 

Games like Monopoly and The Game of Life offer children a chance to weigh financial decisions. It’ll also expose them to real-world activities like investing, spending, earning, and saving, just without the consequences attached to it.

Furthermore, play time is also a great bonding experience for the family. Hosting weekly board game nights with your child can be a good way to get them interested in finance and simultaneously be present as a parent.

7. Encourage Them to Use Expense Trackers

If you give your children a weekly allowance, encourage them to use a budget tracker to track how the money is spent.

There are many financial trackers you can consider, all of which are kid-friendly. GoHenry, Gimi, and Otly are some apps that can help your kid become more financially responsible without being too overwhelming.

By encouraging the use of expense trackers, your child will build a good habit of tracking their finances—which they can carry with them for their entire life.