Parents often wonder when to start discussing money with children. Of course, there is no one answer to that question. As with many topics regarding family and wealth, the substance and timing of these conversations depend on your family circumstances. For younger children, teaching basic savings and spending principles can go a long way in creating a strong foundation that they can continue to build upon as they mature.   

To get started, consider introducing one or more of the following games specifically intended for children age 11 and under:
• Five nickels and a quarter game: Young children often associate quantity with value (e.g., two is better than one; 10 is better than five). Help them understand that this isn’t always true. Show them five nickels and a quarter or other coin combinations, and explain their denominations and values. You can play this activity anytime, anywhere.

• Piggy bank savings: Encouraging children to save a portion of their money—whether it’s received through gifts, an allowance or the neighborhood lemonade stand—can help them learn and develop financial discipline. To make “saving” fun, introduce a piggy bank where a child can save money and other precious collectables. For the smaller ones, crafting a piggy bank out of a mason jar or shoebox might be right up their alley. For children a bit older, an electronic piggy bank will likely appeal to their desire to feel more grown up.

• Rule of three savings: To take the savings lesson one step further, consider incorporating the “rule of three” by asking your children to divide their money into three categories: saving (for longer-term goals, like a new bicycle), spending (for short-term wants, like a toy) and giving (for someone in need or a contribution to a local cause).

• Going on a picnic: To begin teaching children the difference between needs and wants—something that becomes more crucial as children age—plan a fictional (or real!) picnic with your children and ask them to list all the things they’d need to enjoy the picnic. This list may include everything from a tasty sandwich to a Frisbee. From that list, help them identify which items are needs and which are wants. This is an exercise that you can use repeatedly and can be adjusted as children age. For example, instead of a picnic, you might have an older child help plan a birthday party where the same principles can be applied.  

• Add It Up: Understanding how much things cost is an important foundational skill to master prior to learning how to set a budget. To help encourage children to pay attention to costs, play Add It Up on outings to the grocery store, a restaurant or any other shopping experience. The game is simple: Ask your child to guess the total cost of the bill based on all the items purchased (or meals ordered). After a few rounds of Add It Up, you might find that your kids have a better sense of how much things cost, and they also get an early education about how taxes and tipping (when applicable) come in to play.

You know your children best, so feel free to tailor these activities to your needs, add them to playtime and remember to have fun!

Theresa Marx is a senior wealth strategist for CIBC Private Wealth in Chicago, with more than 17 years of industry experience. In this role, she is responsible for developing integrated wealth management solutions and providing comprehensive estate and financial planning services to high-net-worth clients.