Tips for Teaching Kids About Money and Finances
April is National Credit Union Youth Month, shining a spotlight on the importance of financial education for kids and teens. At IAA Credit Union, we know that teaching kids about money early helps set the foundation for lifelong financial success. While these lessons are essential, many parents find it challenging to introduce financial concepts in a way kids understand. Here are some helpful tips for teaching children about money, plus how IAA Credit Union supports financial literacy for families.
How an Allowance Can Help Kids Learn About Money
Giving kids an allowance can be a great way to teach them the value of money. Perhaps that's one reason why so many parents do it. According to a study from T. Rowe Price, about 70 percent of all American kids get an allowance. Here's what you should know.
Separate Allowance from Chores
For starters, don't tie allowance to chores. You want your child to learn that being a part of the family means doing their part to contribute through chores. You don't get paid for emptying the dishwasher, so why should they?
Additional Jobs for Kids
Instead, allowance should be given for additional tasks above and beyond household chores, like:
- Mowing the yard or raking leaves
- Shoveling walkways and driveways
- Washing the car
- Picking up trash in the yard
- Washing out the trash cans
- Deep cleaning the bathrooms or the kitchen
- Clean out the pantry
- Washing outdoor furniture
- Doing various organizing projects
This way, they'll learn that money is tied to work, not just doing the things they're supposed to do.
Have the Money Talk
Now that you are giving allowance, use it to spark up discussions about money. As your child grows older, talk to them about budgeting their allowance. One idea is to:
- Let your teens handle the money you were going to spend on back-to-school clothes and supplies.
- Help them with the process.
- If they run out of money but still want a new backpack, they'll need to earn more or adjust their budget.
- Allow them to make mistakes to learn from.
Teach Good Money Habits
Remember that above all, an allowance is a chance to teach money habits that can last.
- Stress the importance of saving some of that money, so the idea of savings is set early in your kid's life.
- Teach basic budgeting skills.
- Take them with you to the store so they understand the cost of everyday items.
Do One Thing: Search for ways to talk about money every day. The more your kids understand, the better off they'll be.
How IAA Credit Union Supports Financial Literacy
Since 1951, IAA Credit Union has served the Illinois Farm Bureau Family of Companies and their employees. Beyond traditional banking services, we’re committed to financial education, offering youth-focused programs tailored to every stage of development.
The Kids Club is designed as an introductory savings account, helping children learn the basics of saving for short- and long-term goals. Benefits include:
- Opportunity to earn Penny Bucks when making an in-person deposit to the Kids Club Savings that can be used to buy toys in our lobby.
- Access to Greenlight, a trusted family money management tool, on us!
Dollars & Sense Club: Ages 13 to 17
The Dollars & Sense Club builds on the foundation of the Kids Club, offering:
- Savings account and optional checking account with a debit card, with no minimum balance or monthly fees
- Investment opportunity with a Youth CD with a minimum of just $500 needed to open
- Continued access to Greenlight, on us!
The Elite Club prepares young adults to manage their finances independently while still offering support:
- Savings account and optional checking account with a debit card, with no minimum balance or monthly fees
- Access to online banking with remote deposit capture capabilities
- Access to over 30,000 free ATMs nationwide
- Investment opportunity with a Youth CD with a minimum of just $500 needed to open
- Get the lowest rate on your first auto loan with us, no matter what your credit score is
- Access to a Secured VISA tied to the Elite Savings
Greenlight is the loved and trusted financial education app and debit card for kids and teens that allows parents to instantly send their kids money, set up chores and allowances, create savings goals, and more.
IAA Credit Union members get the Select Plan for free (a $70 value) when you register via our unique link and add your IAA Credit Union checking account as the funding source. Parents can add up to 5 kids, each getting their own debit card. Once registration is complete, debit cards will be shipped, and your kids can start learning how a debit card works based on the parental controls you set for them.
IAA Credit Union's Youth Program sets your child on the path to financial success from age 0 all the way to 23. Let's empower the next generation with the knowledge and skills they need to thrive financially!
Become a member today! Together, we can build a future of financially confident and capable young adults.
Originally published by SavvyMoney Blogs on June 13, 2025, adapted by IAA Credit union.
