For Parents

How to Teach Your Kids About Earning Money

Here are the basic principles to teach your kids about earning money and building smart money-making habits.


If, as a parent, you succeed in getting your child excited about becoming financially responsible, then you’ve made a tremendous breakthrough.

This sense of independence can be exhilarating for a kid, and earning money on their own could suddenly become an enticing next move. But how does a parent prepare their child for the ‘why should I’, as well as the more pronounced ‘how to’ when it comes to earning money? One thing is for certain – the result of giving your child a financial advantage in life makes it all worthwhile.

If you’re unsure of where to start with teaching your child how to earn money, this guide can help. Here is where we will discuss ways you can explain to your kids the importance of earning money, ideas on what they can do to make their own, what not to do, as well as ‘earning’ words your child can use.

How to Explain The Importance of Earning Money

If you haven’t yet introduced your kid to the concept of money, Kids’ Money is the perfect place to start!

Children grow, learn and thrive best with the help and guidance of their primary caregivers and parents. Their impressionable minds allow them to absorb information very quickly. They also pick up on what they are consistently seeing and hearing all around them. As a parent, you have an advantage in making sure their first encounter with money is positive and constructive. And remember, you don’t have to be a finance guru or a senior accountant to teach your child how to earn money. Remember to use any of our other resources as a guide to get started!

Here are some fun, comprehensive, and hands-on ways to get your kids to understand the value and concept of earning money.


Intended for all ages to enjoy – Board games, such as Monopoly are created to engage children while teaching crucial and practical life lessons, as well as basic math skills. The game plays out the scenario of living within one’s own means. This relates to the concept of parents who give their child a set allowance to work with. There are plenty of similar board games to Monopoly that can give your kid a birdseye view of how money works and how it is earned.

Additional games that are geared towards smaller, school-age kids (ages 5-7):

  • Price Tag Activity Game: Find items around the house or in the pantry and set up shop with each item having a different price tag. Your child can be the cashier or customer. Either way, they do the math!
  • Coin-based Game: This hands-on method gives them a sense of real-world experiences where money is being identified, counted, and exchanged. Bring out the coins for your child to become familiarized with each coins’ appearance and value while simultaneously learning basic addition and subtraction.

Piggy Bank Method

This method has been tested over decades and serves as an excellent way to teach children about the concept and value of money, and the importance of savings.

Allowance System

Another useful method in teaching kids the true value of money earned vs. given. This is when applying delayed gratification comes in handy. It teaches them to save their money for things that they really want and ultimately, impulse control. A few things to consider when incorporating the allowance system:

  • Create a reward chart as a tangible incentive for the child to be reminded of their responsibilities and privileges.
  • Have sensible policy/rules put in place for your kid to follow to avoid conflict or confusion
  • Decide on how much to give – calculate the right allowance amount and stick with it. Don’t give out extra cash. This will teach them to prioritize and budget their earnings

Check out our most popular Kids ‘Money article on giving kids an allowance.

Once your child has the basic money earning concepts down, they can finally learn to earn!

Ideas You Can Give Your Kids to Earn Money

Does your kid have a craft-making skill? Do they have natural caregiving abilities? Are they always looking for ways to reduce their carbon footprint and to live sustainably? Recognizing a child’s unique talents can be a starting point in discovering how they can potentially earn money. Their money-making journey should be seemingly effortless (to them) and fun. Hone in on their hobbies, skillsets, and aspirations to discover just what it is they believe they’re good at, novelties they might be interested in trying, and what would spark a sense of pride and fulfillment within themselves.

Inspire them to show off and exhibit these skills. Once they realize they can get paid for their services, they’ll be ready to execute in no time. Parents should be bold in partnering up as some smaller children may need the extra hands. Here are some ideas that kids (6 and up) can try, based on skill or interest:

  • Jewelry/Craft Making. The sky’s the limit with this creative hobby! If your child has already started making different crafts and jewelry, challenge them with more intricate/advanced designs. That could also be an opportunity to up their standard price. Your kid will thank you for teaching them the art of ‘upselling’.
  • Pet Care. Calling all pet lovers – do keep in mind that the level of responsibility should vary based on the age of the child. The job can entail walking the dog, changing the fish tank, feeding, grooming, and pet watching/sitting.   
  • Plant Care. If your child has a natural green thumb, then watering and tending to plants in a neighbors’ garden is more like a vacation.
  • Yard Sale. When people gather around to purchase items from a yard sale, which kid wouldn’t want to be the one to discover all of the hidden treasure from around the house?
  • Babysitting. This job would require any child younger than 10, (with much consideration given to kids of higher maturity), to be supervised by an adult while babysitting.
  • Baked goods. If your child loves to bake cookies, cakes, or brownies, they can get started selling locally to get a feel of the business. If they gain enough knowledge and skill, they can expand outside of their locale, and even turn it into an online business. A kid-owned and operated baking business can be lucrative, especially when you consider how much adults tend to have sweet spots for kids. Remember to check your state’s Cottage Food Laws when selling any food that is made from your home before getting started. 
  • T-Shirt Designing/Selling Online. Today, getting an e-commerce store up and running is easy! You can set up your website through a platform like Shopify, or create your own site from scratch and have t-shirts made only as orders are received. This makes the upfront costs to start the business fairly cheap.
  • Start A Blog. For the social media butterfly with something brazen to say, starting your own kid blog guarantees you’re heard. It’s advisable though for parents to step in to monitor their blog/internet activity and to ensure that they’re using it responsibly. 
  • Recycling. Try getting your kid to collect cardboard boxes, plastic, metals, or any other recyclable materials that they have direct access to. The trade-off can be done by utilizing platforms such as iscrap, boxcycle, or going through a Bottle Refund Program.

Rendering any service is easier to do when you actually enjoy doing it. This reigns true for little humans as they can be brutally honest in everything they do. First, you want to talk to your child about their personal interests, find out what motivates them, and then carefully assess what their capabilities are in earning money.

What Not to Do When Teaching Your Kid About Earning Money

Bad money habits, like all habits, can be picked up quite easily by children. If they follow you out to the shopping centers or to grocery stores, they observe your purchases and how you’re personally choosing to spend your money. They also may overhear conversations you may have with others, or statements you unknowingly make about money, so it is imperative that mindfulness is present in order to avoid a child repeating similar actions.

The relationship you establish with money is critical and indicates whether or not there is a natural impulse to buy without reason. If the goal here is to teach a child while they are still in an impressional learning stage how not to spend, becoming more mindful of personal habits that are bad can help.

How to Set A Good Example

Practice Impulse Control

Even the most notable, influential, seeming-to-know-all-about-money finance expert could have a slight impulse to buy something outright without giving it much thought. That’s human nature.

But where it becomes concerning is when you have the impulse more often than not. Getting kids on the right financial track now will save you the hassle of trying to correct bad habits later.
Two quick money rules for any kid to remember:

  1. Money must first be rightfully earned.
  2. Money should then be saved or compounded.

When kids are taught these fundamental money rules, they begin to see how important it is to first prioritize maintaining the money they earn by saving it rather than spending it.

Saving Money

Saving endlessly may not be the goal for a child, let alone an adult. If delayed gratification is put in place, they can use their saved money to purchase something that’s more worth the wait.

To provide a scenario, a mothers’ 12-year-old son had a piggy bank that he owned for quite some time and one day managed to save a whopping $300 without even knowing. He was shocked he could save up to that amount, and excitedly told his Mom that he was ready to buy something with it. Initially, he had been saving his money to buy an automated smart train for $375, as he is a lover of trains and has been intrigued by automation and artificial intelligence. But the thought of him having to hold off for what he knew would be for possibly another couple of weeks gave him great discouragement. His Mom told him it was ultimately his choice and reminded him of how long he had wanted the train and also how close he was to owning it. He admitted that there was nothing he wanted more, so he made the choice to continue saving.

His Mom was both relieved and proud that he had learned to make an important business decision on his own. She also became proud of herself for putting him through the ropes by laying down the financial foundation for him.

Apart from this lesson, what can also be learned is how to alternatively save for an emergency situation. An emergency fund is there during those times of need. A child could have the financial ability to use the same $300 mentioned above to help take his or her family out of a small, unforeseen crisis.

Teaching your kids the difference between their wants and needs can help them understand how saving for what they want, and for unforeseen emergencies is ultimately the best savings plan. Opening a savings account gives them that next level of financial independence, holding them responsible for their funds. This could be a game-changer, especially when your child has outgrown a piggy bank.

As parents, we want the best for our kids, more than life can actually offer. Children, on the other hand, want to see themselves in their parents.

Setting an example for who you want your child to be is simply one of the best ways that they learn and put their money skills into practice. The financial foundation you set will determine their relationship with money as an adult and stick with them forever. Offering your kid a financial headstart during their youth will undoubtedly give them that life you wished for them from the very beginning.

Earning Definitions for Your Kid to Know

Let’s face it. Kids aren’t fond of fancy, finance jargon. Being creative with how we present these terms is in their best interest and will help them to be more receptive to learning them. Start with these money-earning words below that are easy enough for kids to understand.

  • Earn: to receive as pay for work done
  • Expenses: money needed to buy or do something
  • Budget: a plan for how much money will be spent and earned during a certain period
  • Savings: money that has been collected over a period of time
  • Services: any work done for another
  • Labor: hard work or effort is done with or without pay
  • Consumer: someone who buys goods or services
  • Employment: work done for pay

Have the child practice saying, writing, and forming sentences with these words. Then create an instance related to the word that is relatively familiar to them to further their understanding. You can of course adjust this vocabulary list and swap out words that are somehow difficult for words that are more appropriate based on their age and development.

Books About Earning Money To Read With Your Kids

Books have always been an incredible resource to use for learning about any and everything. The topic of earning money is no exception. Books can be especially helpful when parents feel they’ve run out of answers to give and could learn a thing or two themselves while also teaching their kids.

Here are some book resources to guide your child along on their money-earning journey. Check out our library of kids’ money books for parents for even more recommendations!

Related Reading For You and Your Kids

About the Author

Christina Ezeagwuna

Christina is a professional writer with 7+ years in entrepreneurship, opening a rental baby furniture business in 2016 that she still runs today. Christina is a mom of three budding, financially savvy kids and works as a content manager for the Hispanic Alliance for Career Enhancement.

Last updated on: July 18, 2022