Financial Literacy in Kids: When is it appropriate to start teaching them about money?

Heather Moore: My opinion on teaching your kids financial literacy

In a world where financial literacy is increasingly crucial, some Aussie families are taking steps to teach their kids from an early age by charging them rent. By paying their kids an allowance of $6 and then charging them for bills and food, these families turn a mundane task into a valuable learning experience. But not everyone agrees with this – in fact, some think that it’s too early for young children to have to think about financial literacy. “At the end of the day, each family is different. I’m a believer in teaching your kids about money from an early age – and if you keep it educational and fun, it’s a good chance for them to learn and spend time with their parents away from screens,” Heather says. Heather also likes the activity because it is an opportunity for children to practise their numeracy skills and understand the value of money. While some may argue that this practice is too young for children, Heather links it back to real-life scenarios they’ll encounter in the future, like going to work and helping kids role-play adult responsibilities that await them. Heather’s advice is to, “Keep harder topics like inflation out of the conversation until your kids are old enough to both understand and not be afraid of the topic. By doing so, you’ll keep the focus on building essential financial habits that will help your kids as they age.” For adult kids still living at home and earning, Heather suggests they contribute based on their circumstances to prepare them for the real world. This approach not only instils financial responsibility early in life but also helps them transition smoothly into independent living. Heather’s advice for approaching these sometimes daunting conversations? “Be open,” she advises, “and honest. If you try to mislead them about why they’re paying rent or contributing to household bills, they’ll probably see through it. If you frame the conversation around the importance of saving for adult life, housing deposits, or rent, the conversation will have a much more positive tone.” If you’d rather leave money out of the equation, you can experiment with contributions like chores. Both methods teach your kids important ideas about teamwork and responsibility. “Ultimately, I believe that by making financial education a family affair, parents can empower their children to make informed decisions and navigate the complexities of personal finance with confidence,” Heather says. Knight Group is with you every step of the way. If you’re thinking about your financial literacy or want to plan for your family’s future, reach out to speak to one of our team today.