How to teach your child about money at every age

Children pick up money habits from a young age - before they even turn seven, according to the UK Government’s Money and Pensions Service. Yet fewer than half of 7-17 year-olds say they’ve learned about money at home or in school.

So how do you prepare your child for budgets, bills and bank accounts? And when’s the right time to start?

Bitesize Parenting asked Funmi Olufunwa, a personal finance expert and financial educator, for her advice to children at different ages and stages of learning.

Age 3-5: Talk and play

By the age of three, children are already developing basic money concepts. They might not understand prices or exactly what money is, but they’re noticing how you use it. It’s a good time to reinforce ideas through talk and play.

Funmi suggests using a role-play shop as a way to start a conversation. ‘I’ll take this and I’ll give you money, because when we buy things we have to pay for them’. Name the coins and notes, but keep in mind that these days we rarely use them.

“It’s hard for children to understand what money is because we just tap a card or a phone and take something home. Talk them through what you’re doing so ‘paying’ starts to make sense.”

Read Bitesize's guide to how money works

Ages 6-8: Pocket money and saving

At this age, children are starting to understand how money works, so it’s a good time to explore some independence. Funmi says start with a small amount, whether it’s pocket money, birthday money or money to spend on a day out - and let them decide what to do with it.

“Give them choices: ‘You have £5. You could buy one of these, or two of these’. It’s their decision, and that’s how they start to learn about prioritising their wants and needs.”

Waiting is part of the lesson. Show children that if there’s something they really want, they might have to save for it.

How to teach children practical skills including budgeting

“If they want a new toy, explain how many weeks of pocket money that will take. They might save up, or change their mind, but they learn the concept of delayed gratification.”

Should you give your child pocket money?

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Ages 9-11: Budgeting and online

By ages 9 to 11, children are ready for more responsibility and more financial independence. Introduce the idea of budgeting by splitting money into ‘spend’ and ‘save’ pots. Use jars, envelopes or a child-friendly app so they can see their progress. You might also want to encourage them to earn some money to help reach their goal. Could they sell their unused toys or help with a small paid task?

Children may not have their own phones or devices at this age but they’re likely to be using yours, and seeing adverts, unboxing videos and in-game offers. Funmi says that’s your chance to have a conversation about influencers and the risks of online spending.

She adds: “Watch with them and ask ‘Why do you think they’re doing that? Who benefits?’ You’re not saying it’s a bad thing, but you’re helping them think more critically.”

Ages 12-15: Bigger goals and bank accounts

When children get into their teens, they often have a bit more pocket money or start earning from small jobs or chores. If they don’t have a bank account yet, Funmi says now is the time to open one.

“Show them how a bank account works and introduce the idea of interest. If you’re comfortable, talk about investing too, perhaps in a Junior ISA. Money can make money if it’s managed well.”

If they’re getting a bit more cash, you can help them to set bigger goals like a new phone, gig tickets or even driving lessons. Funmi says it’s a chance for them to practice saving for the future: “Help them to balance short-term treats with long-term goals - managing both is a great skill to learn.”

At this age, social media can bring new risks, including "money muling" - where criminals lure teens into moving stolen money in return for quick cash. Talk about it early, and let your teen know that they can come to you if they see anything online that worries them.

The National Crime Agency has more information on Money Muling

An ABC of financial words and what they mean

BBC Teach has a range of financial literacy videos that you and your child can watch together.

Ages 15+: Preparing for independence

Older teens need practical skills for life after school. They might already have weekend or summer jobs. It’s time to start talking about payslips, tax and bills. Show them how to manage their monthly budget and explain credit - how it works, the pros and cons.

Funmi says it’s important to give them space to learn from their mistakes: “We want things to go wrong in a small way now - like spending all their money on gaming so they can’t go out with friends - rather than when they’re older and it's their rent money.”

Keep the conversation going about social media. A recent survey for Santander suggests almost a third of young adults are turning to influencers for financial advice, often on TikTok. Help teens to understand what is trustworthy and what isn’t.

Talking about your own finances can help them to understand money and make better decisions. But you don’t have to share every detail if you’re not comfortable. Funmi says there are other things you can do.

Funmi adds: “We don’t want to worry or burden our children, but there’s no harm in making them aware that there’s a household budget, what it covers and what this month’s priorities might be. Teens will ask questions and we don’t want them to feel shut out.”

And finally…

Teaching children about money isn’t a one-off conversation - it’s an ongoing process that will be different for each child, and changes as they grow. Start early, keep it practical, and create a safe space for any questions.

Funmi says: "We all want our children to develop the skills they need to thrive as adults - managing money is one of them. Ideally, they’ll feel comfortable coming to us with questions or worries, so creating an open, judgement-free space for those conversations is key.”

• This survey shows fewer than half of 7-17 year olds say they’ve learned about money at home or in school.

This article was published in January 2026