Teaching Kids Financial Independence & Life Skills

Kid's Money Saving Tips for Toys, Life Skills, Allowances, Clothes, & Gifts.

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This Kid’s Money Saving Tips page is devoted to teaching kids financial independence and life skills. It discusses Kid’s Toys, Life Skills, Allowances, Gifts and everything else. On this page you’ll find a growing list of our favorite money saving tips for Kids!

This Kid’s Money Saving Tips Page has some awesome ideas for your family. The things we could spend money on for our kids is endless, and so are the opportunities to save money. And along with saving money, we have the opportunity to teach our kids to conserve resources, save time and enjoy things that we buy, even if we don’t pay retail price for them.

1. Your Money Smart Kid’s System & Autism

A toddler sucking on a toothbrush.

I put into play the give/save/spend system. Can you share with me how long you have your children save their money?

I told mine it’s a yearly thing to save for those big items they want, but I’m curious what y’all use it for. We have also put into play the Money Smart Kids point system. We have been using chore charts for years, but your simple point system looks neater.

And I actually have stuff in there that the typical child wouldn’t actually need, as one of my children has autism – so we have TEETH POINTS … brushing teeth without a fight.   RVA – North Kansas City, MO

Editors’ Note: Regarding what our kids do with their “Save Money”. It is to be saved for either a car or college. John, our eldest, used his savings to buy his first car. Their college costs have been covered with scholarship funds.

The only thing we required was that he kept at least $1000 in the bank as a fund for unexpected car repairs. Our 18-year-old daughter, Becky, had a dream of owning a miniature horse and was planning to use some of her savings to purchase the horse and supplies.

2. How Do You Say “No” to Your Kids About Money

Question: How do I convince my kids that they don’t need to have everything that their friends have?

Answer: This is a tough issue to work through. The younger you start to train your children, the easier it will be as they get older. First, remember that you can’t expect attitudes or behaviors from your kids that you aren’t willing to model.

Our culture puts so much pressure on us to conform to trends that being different can be difficult. Here’s how we’ve dealt with it in our family.

Just say no. Sometimes we just lay down the law. No TV’s or computers in the kids’ bedrooms. We don’t care what other families do, we just won’t do it.

Show them a better way.  Sometimes we show them how they can get the brand name clothing or electronic gizmos for a fraction of what their friends are paying through careful researching and buying gently used items.

Yes, it takes an investment of time on a parent’s part, but the more we teach our kids how to shop, and the more we show them how to manage their own money, the more successful they’ll be. Nothing brings greater satisfaction than seeing a kid grow into a financially responsible adult.

If you want a great system for teaching kids to manage their own money, read about how we trained our kids here. 

3. Finding New Kids Toys At Garage Sales

A colorful blue top sitting on a beige carpet in front of a pile of colored building blocks.

Don’t overlook garage sales and thrift stores for great kids gifts. At first, my husband thought I was crazy, but I found three toys, unopened, still in their original packaging, for $1.99 each. I just dusted them off, and they were like new!

The toys were not age-appropriate for my boys, they were “baby toys” and one specifically was a “girl toy.” We decided to donate them to a local toy drive at Christmas. Last Christmas we spent almost $50 on 3 toy donations, this year we only spent $6.
Cindy Saldana – Santa Clarita, CA

RELATED ARTICLE: Free Educational Websites for Kids

4. Do You Give Children Allowances?

How much allowance do you give each child?  Did I hear $1 per year of age?
Jeri W – Akron, OH

Editors’ Note: We don’t think an Allowance is a smart way to teach kids to become financially independent.

Allowances given for simply being a part of a family are more of an entitlement mentality than they are a training tool. We prefer to set up a system where the child earns daily points for achieving specific daily goals, and then reward them weekly with pay based on their performance.

It’s basically like a commissioned job. You can read more about the system we use and how much we pay in our book, “The MoneySmart Family System” or hear about it in the audio download, “Teaching Kids about Money Isn’t Kids Stuff.”

5. Learning Life Skills for Kids Over the Summer

A frying pan with an iron and a spool of thread.

One summer I had to learn a bunch of new stuff. When my siblings and I were teenagers, one summer my mother announced, “I am not cooking, mending or washing this entire summer!” She continued, “It’s up to each of you to learn each skill and do it!”

That summer I was equipped with life skills that I still use to this day . . . and I’m well over 29 now — real age withheld to protect my fragile male ego.   Rick Schell – Boise, ID

6. Gender-Neutral School Supplies Save Money

A girl wearing a black back pack with a name tag on it.

If you have more than one child, buy items in gender-neutral colors. Label backpacks and lunch boxes with your last name only. This way you can pass the items from child to child without having the wrong name on them!   Adrienne Loper – Arlington, TX

7. Using Garage Sales to Gather Consignment Items

I like to garage sale — I often buy clothes for my children, Christmas gifts, etc. this way. Last year, I found a way to make garage sales even more profitable.

I can buy children’s and infant clothes and kid’s toys (only in excellent condition) often for about a quarter. Then I resell them at a local semi-annual children’s consignment sale.

At this sale, clothes sell for 1/3 to 1/2 of the retail price. I can easily get $5 or more for a pair of children’s jeans purchased for a quarter. I’ll get to keep 65% of the sale price, and the remainder is donated to charity. I’m making money and contributing to charity!   Amy Davis – Omaha, NE 

8. Clipping Coupons for Kids to Earn

I wanted to share a money-making idea for children – as well as a money-saving idea for the family budget! I have been price matching at Walmart for several months and have realized a savings of about $35.00 per week.

This helps tremendously, trying to feed ten of us – including five teenage boy athletes!

I am not fond of the coupon hunt but my 14-year-old is. So, he does all the clipping and sorting, and I split the savings with him each week.

He has earned quite a bit of the green, that’s for sure! It took a little “training” on my part to make sure the coupons he cut for me weren’t all junk food! He still slips in the occasional junk food ones once in a while. I even reward his hard work and buy that treat for everyone!

In a very short time, he has saved enough money to fly to California and spend a weekend with his Grandma. He was thrilled and so were we!
Elizabeth R. – Mesa, AZ

Related Article: Stores that Will Price Match Amazon Today!

8. Left Out Toys Used for Re-Gifting

Mom in a blue dress picking up kids toys.

All year long our kids leave toys and things throughout the house and we end up picking them up. To help our kids and our wallet we collect them and place them beyond the reach of the kids and hold them until Christmas time.

The large box is then wrapped with all the kids’ names. They now actually ask for their toys back as part of their Christmas list.

An added bonus is that some lovely toys are forgotten and become more interesting again when re-gifted to the child that owns them. If you’re interested in a book that deals with the subject, read our review of The Berenstain Bears and the Messy Room.   
Allison Amos – Cartersville, Georgia

9. Giving Money or Presents to Kids for Christmas

Question: I have all three of your books and have read about the MoneySmart Family System. Here is my question regarding giving money for holidays (to your children). Do you give money to your children for holidays or do you have a rule to not give money?

Answer: We don’t usually give money to our kids for Christmas, as our family enjoys the tradition of opening presents. Yes, it is more work for us, but so much more fun!

We do set a dollar amount that we spend on each gift recipient, but the cool thing is that because we shop all year long, we’re able to lavish them with a larger number of gifts. T

his is because we can usually find things at steep discounts as we watch and wait all year long. While a flat dollar amount might be easier, being able to give lots of presents for the same amount we might have given is more rewarding.

We also try to find appropriate presents for birthdays, but depending on how busy we are, sometimes we do simply give money, especially if we know the kids are saving for something in particular. The older married kids get a gift card to one of their favorite stores. Our son John is a new homeowner so he loves Home Depot gift cards. 


10. Teaching Kids About Credit Card Interest

Black New Balance gym shoes being put on.

We have a success story because we follow the kids and money section of your book religiously, so I had to share this little story.

Our son wanted a pair of 100-dollar shoes. He didn’t have enough for them in his clothing envelope so we decided to teach him about loans, interest, and debt.

After we purchased the shoes, we added 25 cents interest each week to the shoes. He is still paying for them, but will probably be finished in a few weeks.

He told us, “I am never going to take out a loan again, it costs too much more than just waiting to buy something I can afford.” He has a job refereeing soccer and unfortunately, he has not been able to spend any of his earnings since he has a loan. I wish that would have been a lesson I learned at age 13!  Sybil — Fort Worth, TX


11. Teaching Teenagers About Managing Money

Two different readers asked us about how to teach teens to manage money.

Where Can a Teen Learn Budgeting?

What can I do to help my 15-year-old to learn about budgeting and saving?

Right now he has no expenses and no experience in managing money. Is it too late? He works a little and makes anywhere between $15 to $85 per week depending on his schedule. I have him saving half of it, but not much in guidelines otherwise.

How and When To Teach a Teen to Budget

Right now is the best time to start. You can create lots of situations to motivate him. At this age, driving a car, buying cool clothes, having a cell phone and doing fun activities provide great opportunities. And for working teens to learn to manage their money this should be no problem.

We as parents should not cover all of their expenses. Nor should we allow them to spend all of their earnings on frivolous things. If we do this, we are not preparing them for adult life. Someday they will have to deal with things like mortgages, insurance, braces and toilet plungers.

This may not be popular, but if our own kids want to drive, they pay for their insurance and they drive our cars. We start teaching our kids to manage money using four cash envelopes for the following categories: Give, Save, Spend and Clothes.

As they add more earnings and more activities, we add envelopes such as Gifts, Insurance, Scouts, etc. If you are just starting on this and your kids are teenagers, don’t despair. Help them get a job working for someone else. Then if they are driving, have them start paying for their insurance with a weekly amount.

You will be surprised that as your teen becomes more responsible with his money. He’ll actually feel better about himself and develop a calm sense of self-assurance. For more details read the kids and money chapter in our book or order a copy of our “Teaching Kids About Money Isn’t Kids’ Stuff” audio CD from our website. Or order our MoneySmart Kids Financial Training Kit and help your kids learn to manage their own money.

How Do You Teach Teen To Pay Their Own Way?

What are some first steps to teaching kids how to pay for things they want, even if we blew it early on and they are now teenagers?

Here’s How We Got Our Teens to Pay

You’re right, it certainly is easier when they’re younger. But there is still hope.

The first steps are to communicate to your kids that you love them and you want to help them get ready for a life of financial independence. If you don’t, they’ll view the changes you make as cutting off the gravy train.

If your kids are younger than 15 years 6 months, their opportunities for earning money are limited to the money they can earn for household chores or odd jobs around the neighborhood — babysitting, mowing lawns, pet sitting, etc.

You’ve got to be consistent about assigning chores and paying them each week based on what they’ve accomplished.

Sunday Night Payday

We sit down with our kids every Sunday night, “do payday” and review their finances. Each of our kids is set up with cash envelopes labeled: Give, Save, Spend or Clothes. Yes, they’re responsible for buying all of their own clothes from the money they’ve earned.

If your kids are 16, they should have a part-time job. And even if they work just two days each week, they should have enough money to cover almost all of their expenses. And they should be paying or saving up for their auto/ car insurance.

Even if they balk at doing a budgeting system, they should be paying you weekly for the privilege to drive.

The average teen who drives a family car costs $100 a month. So have them pay you $25 a week for their auto insurance. If they have their own car, it should be more.

Just one more thing . . . you may not like it, but you’ve got to make sure that as the parent, you have your finances well organized so you can be an example for your kids. For more details read the “kids and money” chapter in our first book. Or read our third book which is devoted to this subject.


RELATED ARTICLE: Summer Jobs for Teens

12. How Have You Taught Your Kids to Manage Money?

Annemarie Evans says, ” I purchased banks for them that automatically separates their money into Savings, Giving and Sending. This helps to teach them to put God first (Giving), set some money aside for long-term savings (Saving), then they can spend the remaining amount with parental approval (Spending).”

Age Range(s) For Which This Worked Best: 6 to 11 years old

Robin Besore says, “I have set up an allowance system, and the kids each had a checkbook register to record any money coming in and any money they would choose to spend.  My daughter is now a sophomore in college and she is very careful with her money and how she spends it.

When they were younger and wanted something at the store, if they themselves took their money out of their wallet, and saw how much the item cost, they would give it a lot more consideration then if it was coming from mom and dads money. Both kids also will shop online and look for the best deal.:

Age Range(s) For Which This Worked Best: 12 to 17 years old

Pauly Heller says, “We helped our kids run a hot pretzel business. Prior to that, we used the Give, Save, Spend system with the pennies our kids got to handle. But once they started making “real dough” (ha!), they were working with real dollars.

We made the Lord a 20 percent partner in our business and set aside a percentage each week toward future expenses. Then we divvied up the profits and set aside the Lord’s share for giving. Plus the kids also earmarked their personal earnings to give, save and spend. I think all the kids benefitted from this training, but impulsivity being what it is, two of them were better at incorporating the principles into their lives.

13. My Teenager “Can’t” Save Money

Can you please help me with this problem I have read your blog, Facebook page and books, and I am still having an issue with my teenaged son aged 16 nearly 17. He goes to school full-time, works part-time and receives $20 a week pocket money from us. He averages around $70 each week from his job.

Even with all of this income he cannot save his money! He spends his money on take-out snacks each day and other things. I advise him to save and to plan but it goes in one ear and out the other!!! It’s so frustrating. He spends it all and doesn’t save a thing. He wants a car but at the moment he doesn’t earn enough or save enough for that one!

Please help. I am at my wits end with his budgeting!

Helping Your Teen to Become Financially Independent

The first thing you should do is to stop giving your son $20 a week. He is earning his own money; you don’t need to pay for anything except room, board, and medical expenses. After you close the spigot of money from Mom, just wait things out. Eventually, he will want something and not have the money for it. Then you can lovingly say, “Sorry Dear, I can’t help you. You will have to earn it yourself.” Our guess is that you may be providing too much for him so he is unmotivated to get it for himself.

You might also start creating a vision of what his future will be. Saying something like,

“Honey, you’re almost 18 years old and on the verge of becoming an adult. At 18, you’re going to have to make some adult decisions.

Will you buy a car, take the bus or ride a bike?

Will you go to go to college or work a full-time job?

If you go to college, we’ll help you with research, submitting applications and getting financial aid, but paying for it is your responsibility.

If you work a full-time job, you can choose to move into a place of your own, or pay rent to live here with us.

I love you and know that you’ll make smart choices and accomplish great things, and I certainly don’t want to steal any great financial accomplishments from you by paying for things that you are completely capable of handling for yourself.”

He may buck and complain as you cut off the financial support, but if you’re loving, and firm he’ll do well and gain a financial strength that is unstoppable!

If he does wake up and realize that he wants to accomplish more with what he earns, give him a copy of our book, “America’s Cheapest Family Gets You Right on the Money.” We describe a simple budgeting system to help him manage his money.

Hang in there Mom.  Urging our children to “leave the nest,” is never easy. Let us know how things turn out!


14. Kids Can Spend Your Money … If You Let Them

One hand giving money to another person's hand.

15. A garage mechanic asks about an allowance for kids

One day at a Boy Scout meeting, Steve was talking to one of the dads. He was a head mechanic for a local auto repair garage. He made decent money but was frustrated at how much money he was spending on his kids. It seemed that every weekend they hit him up for $20 to “spend at the mall.”

16. What Does an Allowance for Kids Cost Parents?

Quick, do the math. 2 kids. $20 per week for each of them ($40). Every weekend . . . minus a few for vacation, sickness or when dad requires them to do some chores—say 45 weekends per year. $40 x 45=$1800 each year.

Wouldn’t you be frustrated with an $1800 hole in your bank account? $1800 spent on your kids—and it returns nothing—zero, zip, nada!

17. If you give an allowance get something for it

Steve told him how we trained our kids to handle money. Sure it cost us something (about $1200 per year). But we required them to use some of it to buy their own clothes, some for giving to charities or church, and some for spending on things they wanted. We started teaching them really young—about 6 years old. And by the time they reached their teen years, they were on autopilot. They had money in the bank, paid for most of their camps, all of the Christmas presents they gave to others, all of their clothes and all of their discretionary spending.

18. Another way to do an allowance for kids

Steve’s suggestion to him was to find a way for the kids to earn the money from him, either through chores, volunteering somewhere or helping younger siblings. The bottom line was that he should be getting something in exchange for the $1800 he was spending. We totally endorse the idea of parents slowly removing the financial props they give their teens, by slowly transferring age-appropriate adult financial responsibilities onto their shoulders. With the goal being that by the age of 18 our kids are financially strong enough to move out on their own.

19. Helping Teens Prepare for Money as Adults

This is a powerful video, full of actionable tips for teaching Teens to become financially mature. 

BONUS DEAL: If you go to the show notes on this Teens & Money YouTube video, you’ll get a discount coupon code to save 30% on a bundle of products to help your Teens with money.

A pile of gold coins covered with type that says, "Are we raising future adults or perpetual children?"

“Are we Raising Future Adults . . . or Perpetual Children?”

The MoneySmart Family system book cover, tipped.It’s time to cut the cord of financial dependence

It’s interesting that at birth we cut the umbilical cord, but in America, we delay cutting the cord of financial dependence far too long. Currently, 60% of parents are financially supporting their adult children. This practice does not build financial independence, it creates a greater financial DEPENDENCE.

Related Pages:

For more great Kid’s Money Saving Tips, visit our Pinterest Page and click on our Kids/Teens/Babies Board.
If you’d like a list of kids picture books, check out these reviews.
If you’d like to see this list of reviews for kids chapter books, click here.
And finally, if you’d like to see some reviews for kids holiday books, click here.
Oops, one more, Family movie reviews here.

Okay, we lied, here’s a blog about summer jobs for teens, this resource might be helpful.
And here’s a blog we wrote about whether to give your teen a car or not.
And we also have a blog about teens and credit scores!

If you’d like more ideas for saving money with kids, check out our third book, “The MoneySmart Family System.”

If you have a favorite money-saving tip for kid’s toys, clothes & skills that aren’t listed, please feel free to add it in the comment section below.

2 thoughts on “Teaching Kids Financial Independence & Life Skills

  1. Jennifer

    We’ve recently discovered pawn shops as a great and incredibly cheap source for kids’ entertainment. We are a tv-free family, but we do allow our kids to watch DVDs. We recently discovered that one of the local pawn shops sells used dvds and blurays for $1 each. They have a huge selection that consists of newer “real” movies (not the low budget stuff you can find at the dollar store). As a bonus, this particular pawn shop does a big clean out sale every three months where everything is 50% off! They also have a wide assortment of sporting and outdoor goods, which is great for my house full of athletes and hunters!

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