Money has to be flowing in somewhat regularly if you want to teach kids and teens how to manage it (and those $20 birthday checks from Grandma only come once a year). That’s why a weekly allowance—however small—is always a good idea.


    Step 1: Explain that gifts and lottery windfalls aside, you’re not going to get money in your pocket without performing some kind of skill or task first. Assign each child an age-appropriate chore or chores to tackle each week, and establish a monetary value for a job well done.

    Step 2: Follow through. If chores aren’t performed, allowance won’t be paid. It’s that simple.



It’s important to communicate to kids at any age that the money coming in most likely won’t cover 100% of your wants and needs all of the time. Saving a portion of your income today ensures you’ll have something reserved for when you need it.


    Step 1: Make sure each child has a savings account that’s earmarked specifically for their future.

    Step 2: Recognize that it can be challenging for kids and teens to separate saving for the future (college, a car) from saving for something that might come up in the near-future (a new video game, the ice cream truck).
    To get around this, some experts recommend a child have three piggy banks instead of one: Bank 1 for future saving (this money can go into the savings account you set up), Bank 2 for everyday spending, and Bank 3 for donating to charity (another habit to be encouraged from an early age).

    Step 3: Motivate contributions to future savings by offering to match any money put into that account.


THE CONCEPT: Budgeting
Tough economic decisions are a part of life. The right ones are made by those who have a solid grasp of what they want vs. what they need.


    Step 1: Make it understood that you, as a parent, have their “needs”—food, shelter, clothing—covered (within reason). Sometimes younger kids have the mistaken impression that Mommy is buying whatever she wants all day long—at the grocery store, at the gas station—so make it clear that those purchases are family necessities, not personal desires.

    Step 2: Put them in charge of their wants (again, within reason). If they want to go to the movies with friends, buy the toy they saw advertised on TV, or get a new pair of jeans even though there are two perfectly good pairs in the closet, it will have to come out of their “spending” bank. If there isn’t enough money in the bank to fund all the things they want right now, they’ll have to figure out how to budget accordingly.

Comparison Shopping


THE CONCEPT: Comparison Shopping
Impulse buys, lack of research, bad timing, and human nature can be a person’s financial downfall. Being a savvy consumer counts—and these days thanks to the internet, it’s easier than ever to play that role.


    Step 1: Lead by example. The next time you have to make a big purchase that impacts the whole family, include everyone in the process. Show them how you take your time, do your research, and keep your information well-organized before making the best decision.

    Step 2: Teach older kids how to navigate the internet to evaluate reviews, compare prices, look for and use promotions, and set up alerts when a product goes on sale. Younger kids can help clip coupons or check the weekly circulars for upcoming sales.

USAA is there for kids and teens on the road to financial independence. Click here to find out how.