When it comes to budgeting for children, it’s important to learn at a young age. Forming a solid budget foundation allows your children to more easily navigate the real world than most.

Moreover, you can also include budgeting lessons in their day-to-day lives at a young age. Here are some methods you can use when instructing children about budgeting.

Why teach your kids about money?

You might think that your children are too young to worry about a budget. And they are definitely not going to pay for the house payment anytime soon.

Teaching your child sound money management skills will set them up for a bright future.

As you learned money management for the first time away from home, you likely didn’t have the know how to create a workable budget system.

Imagine how beneficial it could be for your child’s future if they start earning good money habits early in life.

A recent study by a financial publication shows more Americans are budgeting than ever before.

What can kids budget for?

Your children’s budget is going to be a lot simpler than your family budget. Even though they have fewer income and expenses, your kids can still set a budget that allows them to reach their own financial goals.

A budget for children could begin with a savings goal. For example, they could start a savings account toward the purchase of a new cell phone or their first car.

How to teach your kids about budgeting

There are many important concepts to teach children about budgeting.

You don’t have to install all of this data at once. You can build up their financial literacy over time.

When teaching children about budgeting, be sure to inform them of the essentials of the relevant scenarios.

Start talking about money

Just getting families talking is the initial step in teaching children how to manage their finances.

As you journey through life with your children, look for opportunities to open discussions about money and how to create a budget for youngsters.

For example, you may mention that you buy groceries based on your allowance at the supermarket. Items that are not in the budget cannot be put in the cart.

You could give your child an allowance to explore money management topics together.

Explain the value of money

Without an appreciation of the value of a dollar, children will have a complicated transition into the adult life. Rather than allowing them to proceed unprepared, consider providing them assistance as they learn to value it.

As your children get older, they will probably discover just how much prices differ at shops. For example, they might buy a piece of candy for $1 or a gallon of milk for $4.

But in addition to various price points at the store, consider teaching your child the value of a dollar in relation to work.

You can pay them yourself to perform jobs or allow them to take a part-time job so they can earn money for their first paycheck. As they gain experience, you can tie the value of money to work in their minds.

Budgeting For Kids
Budgeting For Kids

Practice needs vs wants

It’s common knowledge that we live in a society that has a heavy emphasis on consumerism. Although it’s a part of our lives, it’s important to teach your child the difference between needs versus wants.

Necessary things are things that you cannot do without. Some may include food, housing, and transportation.

In contrast, the preferences of patients are nearly everything else. Patients’ demands range from an additional candy bar to a brand-new video game.

If your kid makes this distinction early, they may be able to avoid a great deal of pain in the future.

Help them set budget goals

Budgeting goals are essential for any age. But setting financial limitations is especially crucial when instructing children about budgeting.

First, have them list their most significant financial objectives. As an example, they might want to save $100 for the most recent video game.

Give them an idea of how much time they need to finish a task. Nailing down a timeline will help them stay focused. Let’s say they would like to purchase the video game in five weeks.

Next, they need to set a budget to reach the target. In this case, they would need to save $20 per week to do so. Depending on the situation, they may not have enough income to obtain $20 per week.

At that point, they may start doing more valuable tasks for pay or get extra work like mowing lawns, selling lemonade, or selling items they declutter to reach their objective.

When your child reaches a milestone, budgeting can really start to become meaningful. After all, everyone loves it when plans succeed.

Make it fun

Budgeting for kids can be an important lesson. But sometimes, it can be difficult to keep your children interested in the task.

One option is to use budgeting worksheets.

The fun colors and simple design make the monthly budget booklet an accessible teaching tool. Not only is a printable copy a beneficial learning tool, but it is also cost-free.

You can use the “Share, save, spend” printable budget sheet as a teaching tool to help kids in life’s most important financial lesson of sharing and saving. The visual tool provides children with the opportunity to define three budgetary categories utilizing a colorful graph.

A lesson in budgeting for kids

When assembling a budget, children can have a more straightforward take on things. There is no need to create complex spreadsheets.

But it is useful for a child to divide their budget into four sections: saving money, spending, investing, and giving.

Here’s a closer look:


Teaching children the importance of saving money cannot be overemphasized. It’s a fundamental financial concept for parents, and efficient savings strategies form the cornerstone of a financially secure future.

You can teach your kids both short-term and long-term objectives.


The necessity for responsible spending is central to budgeting for children. Work with your children to enable them to put aside just a percentage of their funds for purchases.

Their budget will allow them to learn about the consequences of overspending. For example, if they overspend on a new toy, they may not have the funds they need for their next purchase.

Encouraging them to avoid overspending will help them prevent future mistakes.


Investing is a little bit more complicated a money subject. But if you can teach your child the basics of investing, they will appreciate the experience.

There are plenty of kid-friendly investment apps, such as Acorns and the Stockpile app, that can guide your child in establishing an investment portfolio of their own.

This lesson teaches your children how investing their money wisely can accelerate their financial aspirations.


Many parents exhort their children to include “giving” in their family budget. In a giving category, a child can designate which charities and causes they want to support.

It’s a way to teach children how their money choices can impact causes they support.

Example budget for kids

Here’s an example of a child’s budget.

If your child earns $10 a week through an allowance, he must be eligible for a subsidy.

Of course, how they split up the money is up to them.

If they have specific savings goals in mind, they might begin prioritizing saving money over spending. If they are particularly generous, they might push most of their budget toward donating.

It all begins with how much money they have. Depending on their situation, they might have an allowance, a part-time job, or holiday money from a relative.

You can reduce their planned expenses from their earnings. Walk them through the process of adjusting their budget according to their financial goals.

When should you start teaching kids about budgeting?

It’s never too early to talk to your kids about finances.

Children’s lessons should be age-appropriate. A three-year-old may require a completely different teaching style than a 16-year-old would.

Usually, elementary-age children are capable of learning money skills. You’ll have to determine when children are mature enough to begin building their financial management skills.

Budgeting for kids teaches them how to manage money well!

Budgeting for children will help instill valuable money management skills. When the right foundation has been established, your child is better prepared for the challenges that life will throw at them.

Financial matters are a major source of impact in our lives.

Find even more suggestions for teaching about finances by sharing money books with your kids.


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