How to Develop Healthy Money Habits in Kids

Tax season is a great time to start talking about finances with your kids, whether they're preschoolers, high schoolers, or college students. The earlier you start this conversation with your child, the healthier their money habits will be and the better their financial future will be.

Here are some tips to help your kids learn to save money, budget, and manage their finances more independently.

1. Start a conversation about finances

It's never too early to have an open conversation with your kids about money so they understand their role in the family's finances. Use an age-appropriate style of conversation. Explain key points, such as the difference between needs and wants, the importance of saving for something special, and tracking your income and expenses. Eventually, they'll understand the value of putting aside their allowance or soda sales to buy something big.

2. Take notes and use tools

As your children get older, teach them the basics of budgeting, at least at the most basic level of keeping track of their income and expenses so that they don’t spend more than they earn. Have them put any money that’s left over aside for later use on things they’ve been wanting. There are many resources available for budgeting. Find the one that works for you, including budgeting spreadsheets, helping you track your expenses.

3. Organize your notes and use digital tools

Financial stability starts with organization. You can find easy-to-use budgeting tools that work for parents and kids of all ages: first bank account, accounts for high school students or students. EThere are many options to help kids of all ages understand digital transactions, account balances, budgeting, and savings.

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4. Plan for the future

According to Bankrate, 59% of Americans are unhappy with the size of their financial “safety net,” and 27% have no savings at all. It’s important for children of all ages to understand that unexpected events happen in life, so financial planning can help reduce stress and better cope with potential difficulties. The ability to create a financial “safety net” and save money for a “rainy day” is a very important skill.

If your kids develop healthy money habits now, they will stick with them for life. Once they learn financial tools, they will be able to control their budget and achieve their financial goals.

Learn more about ways to help your kids develop good financial habits by following this link: chase.com/studentbanking.

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