Most of us didn’t grow up with formal “money lessons” at home. However, our spending and saving habits often began long before we earned our first paycheck. Children pick up more than we realise just by watching how we handle money, which means the earlier we start teaching them good habits, the better.
So, when should we begin, and what should we actually be teaching them?
According to behavioural researchers from the University of Cambridge, money lessons can start as early as age three. That’s when children begin forming habits through play – like pretending to shop, deciding whether to “save” or “spend”, or learning that choices have consequences. By age seven, most children have already grasped the basics: money has value, waiting can be worthwhile, and not every decision can be undone.
South African research backs this up. A 2023 UNISA survey found that when parents discuss money, their children tend to make more informed financial decisions as young adults. Similarly, a 2019 study by Nelson Mandela University found that parents who discuss money openly, set examples, and involve children in small financial tasks raise children who handle money more responsibly.
Gavyn Letley, a dad and Product Head at DirectAxis, says it best: “All the international and local evidence points to early parental involvement, experiential learning, and real-world scenarios consistently resulting in better outcomes when dealing with money during adolescence and adulthood.”
The trick is to keep money lessons age-appropriate and, ideally, fun. Letley shares some simple ideas for each stage.
Ages 3–5: Learning delayed gratification
The Rolling Stones were right when they sang, “You can’t always get what you want.” And that’s a lesson every toddler should learn!
In a world of instant everything, from streaming to same-day deliveries, it’s easy to expect things now. Teaching little ones that waiting can be rewarding helps them develop patience and an early appreciation for saving.
Try using a piggy bank or savings jar for birthday money or rewards from chores. Help your child set a small, achievable goal, maybe a new toy, and count the coins together as they save.
“Letting younger children handle cash under supervision is a good idea. Physically counting money manifests how their savings are growing and makes them think a little harder about how they spend it.”
Ages 6–10: financial responsibility and simple budgets
Once children start school, they can begin learning about budgeting and making choices. Give them a small allowance or pay for household chores, and show them how to manage their money: set aside some for saving, some for spending, and perhaps a bit for contributing to a shared family expense, such as pet food.
Let them experience trade-offs. A trip to the supermarket is perfect for demonstrating priorities: first the essentials, then the treats.
“The point is to give children a realistic understanding of how to manage money, using familiar examples. They’re far more likely to grasp this than abstract explanations,” says Letley.
Ages 11–13: long-term goals and interests
Pre-teens are often focused on short-term pleasures, such as snacks, clothes, or mobile data. This is the perfect time to introduce the concept of delayed gratification and opportunity cost: giving up a small treat today to save for something more substantial tomorrow.
Talk about compound interest, too – how money can grow over time just by being saved. Once they’re saving more, swap the piggy bank for a junior bank account (many banks offer fee-free options for under-18s). It’s a great way to show them how banking works and build confidence with money management.
Ages 14–18: borrowing wisely and credit awareness
By the teenage years, many children are earning their own money through babysitting, tutoring or helping around the neighbourhood. With greater earning power often comes greater temptation!
If they ask to borrow money, turn it into a teachable moment. Create a mini “loan” with repayment terms, interest and due dates. It may sound a bit formal, but it’s an effective way to show how borrowing works and what happens when repayments are missed.
“As a parent, teaching children about money isn’t something you’ll ever stop doing. Perhaps the most important lesson is to remember that you’re a role model. It’s not just what you teach them, but your financial behaviour that will influence their relationship with money and how well they manage their finances as adults,” says Letley.
