Teach kids how to save money

In a world driven by instant gratification, teaching children the discipline of saving money is one of the most powerful gifts you can give them. It’s not just about hoarding coins; it’s about learning to plan, prioritise, and appreciate the value of effort.

Fortunately, financial literacy doesn't require a lecture! You can transform abstract concepts like budgeting and interest into fun, hands-on activities and visual games that children actually get excited about. From setting up simple, transparent savings goals to linking household chores to commission, this guide will show you how to start building a positive, powerful relationship with money from a young age, preparing your kids to become confident and financially savvy adults.

How to Teach Kids How to Save Money!

Here are some fun tips and age-appropriate activities to teach kids how to save money. By following these simple money saving tips, you can teach children that saving isn't about deprivation; it's the power to plan for the future and achieve their goals.

Make Saving Visible and Exciting

The key to early saving is making progress easy to see. Here's some ideas -

1. The Clear Jar System

Ditch the opaque piggy bank for clear jars so your child can literally watch their money grow. This visual progress is highly motivating.

"Save, Spend, Share" Jars - Set up three labeled, clear containers:

• one for Saving (for a long-term goal)

• one for Spending (for small purchases)

• one for Sharing (to donate to a cause)

Encourage them to divide any money they receive among the three jars.

2. DIY Piggy Banks

Let them decorate old jars, shoeboxes, or containers to create personalised 'piggy banks'. Label each bank with a specific savings goal, like "New Bike Fund" or "Zoo Trip".

Teach Kids to Save Money - Make saving visible and exciting

3. Create a Savings Vision Board 

Help your child cut out pictures from magazines or print photos of the toy, trip, or item they are saving for. Display the vision board near their savings jar to keep them motivated and focused on their goal.

4. Savings Challenge Treasure Hunt 

Hide jars of coins around the house and create a treasure map or clues for your child to follow. Each jar can represent a different savings goal, turning saving into an adventure.

Introduce Saving as a Game

Games are the best way to make a potentially boring concept fun. Try some of these ideas -

1. Savings Bingo

Create a bingo card with squares that represent saving actions: "Save a Pound", "Skip a Treat Day", "Earn Money Doing Chores", or "Find a Coin". When they complete an action, they mark the square. Offer a small prize for getting a line or the whole card.

2. The Matching Game (the "interest" lesson)

Offer to be their "Savings Partner." For every set amount of money they save, you "match" it (like £1 for every £5 they put in). Explain that this extra money is like the interest a bank pays them for keeping their money safe.

Teach Kids to Save Money - Introduce saving as a game

3. The Penny Game (compound interest for kids) 

Give your child one penny on day one. Tell them you will double the amount they have each day for a set number of days (e.g., 10 days). They will see the amount grow slowly at first, then rapidly, teaching them the power of letting money sit and grow.

4. Financial Literacy Board Games

Play classic games like Monopoly or The Game of Life. These games introduce concepts like buying assets, paying bills, and making strategic financial decisions in a fun, family-friendly setting.

Connect Effort to Earnings (and Saving)

Help children understand that money is earned, not just given. Here's a couple of examples -

1. Commission for Chores (vs. Allowance)

Instead of a fixed allowance, pay them a commission for specific extra chores (outside of their normal, family-duty tasks like cleaning their room). This links effort, work, and income, making them more invested in how they save or spend their earnings.

2. Entrepreneurial Play

Help them set up a small venture, like a hedge veg stand or a small craft business. Guide them in setting prices, tracking sales, and budgeting for supplies. Then, encourage them to save a portion of their profits.

Teach Kids to Save Money - Connect effort to earnings

3. 'Shopping' for Real

Give them a small amount of their own money from their spending jar to use at the store. When they want an item, have them physically count the money and hand it to the cashier. This makes the cost of goods a tangible experience.

Lead by Example and Talk About Money

Your actions are the most powerful teaching tool. Here's a few examples -

1. Talk Out Loud

Narrate your own saving decisions. For example, say: "I'm going to wait and buy that tool when it goes on sale so we can save the extra money for our family holiday fund."

2. Explain "Opportunity Cost"

Use real-life situations to explain the concept that choosing one thing means giving up another. For example, "If you buy that small toy today, you won't have the money to buy the new video game you really want next week." This teaches them to weigh their options and prioritise.

Teach Kids to Save Money - Celebrate their success!

3. Celebrate Milestones

When your child reaches a saving goal, celebrate their success! This positive reinforcement makes saving feel rewarding and reinforces the habit.

4. Open a Real Savings Account (Ages 10+)

When they are a bit older, take them to the bank to open their very own savings account. Explain how the bank keeps their money safe and how it grows a little bit over time by earning interest.

Here's a graphic summary of How to Teach your kids How to Save Money -

Kids Save Smart! How to Teach your Kids How to Save Money

Have fun teaching the kids all about Saving!