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5 Money Habits for Kids that Will Save Your Sanity

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Chances are, your highschooler’s financial health relies heavily on part-time jobs or yearly birthday checks from Grandma and Grandpa. Regardless of how little your child earns throughout the month, it’s never too early to teach healthy money habits for kids.  Moving off to college will require anunderstanding of budgeting and financial literacy so they can make ends meet. 

Lecturing your teenager on the dangers of blowing their paycheck will be uncomfortable. However, the skills you teach them will help them achieve financial freedom in the long-term. 

Unfortunately, college students have spent the last 18-19 years living under their parent’s thumb. That means balancing their finances may be challenging at first. Some students excel at financial literacy off the bat. Others get caught up in the moment and blow through any savings they had in a matter of months. In the latter situation, fresh-faced students are often riddled with anxiety as they scramble for extra cash. Reckless spending can lead to disaster, forcing many to pick up several part-time jobs or take out hefty student loans to make ends meet. 

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Teaching Good Money Habits for Kids

By instilling good money habits for kids early on, you allow them to practice necessary financial skills before heading off to college. You can start small and teach your child about the following five habits to set them up for financial success. 

The importance of good credit 

In the United States, only 1 in 6 high school students learn about personal finances and credit card usage, leaving many confused and frustrated with their lack of financial know-how. Your child is likely unfamiliar with how credit lines work and why improving your score now can benefit you later in life. 

However, you can help your teenager by teaching them about different credit lines and proper usage early on. Students can greatly benefit from opening a student card, like those from 1st Financial Bank USA, which comes with reasonable limits, automated payment reminders, and cashback reward programs. By teaching your child about proper card usage, they can leave home knowing how to utilize credit cards responsibly. 

Put a portion of your income in a savings account

Even when working a minimum wage job, your child should put a portion of their paycheck into a savings account when possible. Come up with a percentage they should strive to put in savings and instruct them to leave the balance alone and watch their savings climb.

Create an emergency fund 

In addition to having a savings account, your child should create an emergency fund. You never know when they’ll blow a tire, land in the hospital, or end up in a freeway fender-bender.  Having a safety net accounts for unforeseen events, allowing your child to sleep easy knowing they’re secure in the future. 

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Create a budget and stick to it

Although your child likely doesn’t pay for expenses at home, they’ll need to learn budgeting skills regardless. Sit down with your teen and explain the power of proper budgeting and create a plan with their finances. Additionally, have them pay for monthly expenses, like a phone bill or partial car insurance. This allows them to practice money management in a low-risk situation.

Always track your spending 

Debt is the result of not realizing how much you actually spend each month. Once you have created a budget with your child, have them track each item carefully. Ensure they follow their money plan and dodge overspending. If your child learns how to follow their finances, they’ll learn how to stick to a budget and practice restraint. 


Although teaching your teen financial literacy may feel like pulling teeth, instilling good money management skills into their lifestyle can be the difference between a long-term financial dependent and an independent student ready to take on the financial world. Teach your child to budget, save, and track their expenses early on and send them off worry-free.

Teaching healthy money habits for kids can be this easy? I love #3!