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Toddlers to Teens: Raising Financially Responsible Kids


Ages 3 to 5

At this age, kids won’t be able to understand much about financial topics; however, parents can lay a healthy foundation for their child’s financial future.

Children can begin to understand patience and saving versus spending. While your child is playing with friends or on the playground, look for opportunities to talk about waiting their turnwaiting their turn, for the swing, for a toy, etc, and why it’s important. This will help your child apply the same understanding to money – that sometimes you have to wait until you have enough money saved to make a purchase.

This is also a great time to talk to your children about wants vs. needs. Kids often think they need the newest toy or a second cookie. Talk to your kids about the things they need to be healthy and safe – healthy food, a safe place to live, clothing, etc. Have them give you a list of things they need and discuss whether they are wants or needs. Below is a sample list of items you can use to briefly “quiz” your child.

  • Bicycle
  • Water
  • Television
  • Winter coat

Kids at this age will also begin to start learning numbers and how to count. Parents can help by counting often with their kids, even if it’s uner lated to money. Count the number of stairs in your house, how many steps from the car to the front door, how many strawberries in their bowl, etc. A fun way to reinforce this is to play store. Line up and count your “goods,” and assign each item a price. Then have your child help to add up the total.

Finally, 3-5 years of age is not too young for kids to start earning money by doing chores. If you’re comfortable with it, set an allowance for each job they complete. At this age, simple tasks such as feeding pets, taking dishes to the sink, and picking up toys in their room are good chores to start with. Use a chore chart to track what jobs they’re doing and how much they’ve earned. (See our printable chore chart on page 18!) When they receive their allowance, help them put it in a piggy bank and count it together each week.


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