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5 Easy Ways to Teach Your Children About Money Management

“It’s just like riding a bike.”

When a skill comes naturally to us despite not using it for several years, we say “it’s just like riding a bike.” When we learn how to ride a bike as a child, it doesn’t matter how many years it has been, we always remember how to get back on and ride again. The foundation has been laid and now we are prepared to take on that challenge at any point in life.

As humans, we are not born with the natural ability to ride a bike, so when we teach children to take it in steps. You might start with training wheels to gain familiarity and confidence with the bike, and then remove them to practice balance. Before you know it, they are speeding down the street with ease! During this process it is important to practice patience, reinforce success, build confidence, and most importantly, keep it fun. These same principals can be applied when teaching young children the fundamentals of finance.

Here are some effective tips for helping your children build a sound foundation of financial knowledge:

1. Coin identification game

Encourage children to learn the denominations of currency by making it a guessing game.

2. Establish an understanding of the exchange of goods

In today’s world, technology allows us to buy items by swiping a card or pressing a button on our phone. Children who only see their parent pay with a card will learn to associate buying anything they want with a simple swipe, but what they don’t see is your bank account dropping with every purchase. Provide opportunities for your children to place money into a piggy bank, then later spend it on an item that they want. This will help establish the physical connection between exchanging something you have for something you want.

3. Establish opportunity cost and budgeting

Now that they understand the exchange of goods, find opportunities where they must use their own earnings to choose between buying one item or another. This helps to establish the first concepts of a budget and buying power. You can also accomplish this by playing games like “grocery store” or “restaurant” with your children to create scenarios where they have a limited budget and must make choices on what to buy.

4. Encourage them to play fun interactive games

Turning learning opportunities into games will not only help the child engage more in the process, but it will also help them retain more information.

There are countless online educational resources that provide online games for all ages, including the Washington State Department of Financial Institutions which offers an abundance of games available for free. To learn more visit:

5. Include children in family meetings

Have open conversations with the entire family to discuss a variety of topics, including personal finances. For example, if you are planning a family vacation, discuss the details with your children during your family meeting. Including your children in making big decisions provides them with real-world opportunities to practice and apply budgeting. Family meetings also present the opportunity to reflect on ourselves and improve in areas we might see ourselves lacking.

It is never too early to begin teaching your children the fundamentals of money management. I encourage you to take a proactive approach and lay the foundation using the tools you have on hand. We are not born with money in our pocket and an understanding of what it means or what to do with it. It takes time and practice—just like riding a bike.

Find out more about starting your money management journey, such as opening bank accounts and using debit cards by visiting our Personal Finance F.A.Q page, click here.


This memorandum expresses the views of the author as of the date indicated and such views are subject to change without notice. Community First Bank, HFG Trust, and HFG Advisors have no duty or obligation to update the information contained herein. Further, Community First Bank, HFG Trust, and HFG Advisors make no representation, and it should not be assumed that past investment performance is an indication of future results. Moreover, wherever there is potential profit there is possibility of loss. This memorandum is being made available for educational purposes only and should not be used for any other purpose. The information contained herein does not constitute and should not be construed as an offering of advisory services, banking services, or an offer to sell or solicit and securities or related financial instruments in any jurisdiction. Certain information contained herein concerning economic trends and performance is based on or derived from information provided by independent third-party sources. Community First Bank, HFG Trust, and HFG Advisors believes that the sources from which such information has been obtained are reliable; however, it cannot guarantee the accuracy of such information and has not independently verified the accuracy or completeness of such information or the assumptions on which such information is based. This memorandum, included the information contained herein, may not be copied, reproduced, republished, or posted in any form without the prior written consent of Community First Bank and/or HFG Trust and/or HFG Advisors. HFG Advisors, Inc, is a wholly owned subsidiary of HFG Trust, LLC. HFG Trust, LLC is a Washington state-registered Trust company and wholly owned subsidiary of Community First Bank.