2.) Set up an age-appropriate allowance and schedule so that your child can experience this planning firsthand. Show the children how they can divide their allowance into three categories -- saving, spending, and sharing. Impart your own values; it’s different for each family. We encouraged Gianna to save at least 10 percent, share 10 percent, and spend wisely -- if she wants to buy another Webkinz, that is her choice but we will not help her and, if she spends it all, she will have to wait until next week to have more money to spend.
3.) Know your child’s money personality. Gianna has a tendency to hoard her allowance and expect me to pay for her “goodies.” Knowing this, I can be prepared when I go out with her to say, “Bring your wallet in case you want to buy something.” The expectation has to be very clear up front as to what parents buy vs. what kids buy. At this age, I don’t expect her to buy her own movie tickets, for example, but at age 14 I would.
4.) Help your child open up a savings account at the local bank. Walk him or her through all of the steps. My daughter and I went to the bank together and I had her write out a deposit slip and then give it to the teller so that she could then see how much she deposited, how much she had in total, and how much interest she earned. This allowed us to have a conversation about interest in a very rudimentary way --interest is the money that the bank pays you to keep your money there.
5.) Play age-appropriate board games, like "The Game of Life," that teach financial concepts like borrowing, buying, saving.
And of course, model healthy financial behavior. It is your walk, not your talk, that will resonant most deeply with your children. If they see you making financial goals and doing what it takes to meet them, being generous, delaying gratification -- all of that will have a profound impact in the long run.