Teaching children how to budget at a young age will be helpful for them later in life. When your child gets money as an allowance or as a gift, you can help get them started with simple budgeting concepts.

Start with Goals, Wants, and Needs

Talk with your child about money and how to use it wisely. Encourage them to set goals for their money. What are their wants and needs? They may have short-term goals in mind where they’d like to use their money for a purchase right away. Or, they may have long-term goals that will require them to save money over time. It’s helpful for children to be reminded of the importance of saving and why they should not get into the habit of spending their money too quickly. 

Save, Share and Spend Method

The “Save, share, and spend” method was created to teach children to set aside money toward each of these three purposes.


When your child starts to earn money, the most important thing to do is set aside a portion for savings. The recommendation is to save at least 10% of earnings. This percentage can be increased for children simply because they have fewer expenses. Savings can be accumulated in many different ways. Some use a jar, piggybank, or even a joint savings account with a parent or guardian that’ll earn interest (GOLD has Youth Accounts to help your kids develop a healthy relationship with money). The savings account should be kept for emergencies (new bike tire) as well as longer-term goals (first car).


Teaching children about charity at a young age is also useful. Allow them to research and contribute to a charity of their choice. Like saving, sharing is typically also around 10% of their earnings. Discuss options with your child to determine which cause they may enjoy donating to. Also consider having them volunteer with that organization to understand what or who exactly they are helping. For example, it can be very rewarding for children to use money to purchase toys for a local outreach center. Then, they can help pass out those items out to families in need around the holidays.


The remainder of their earnings can go toward spending. The spending category is available so your child can make purchases that they choose, but be sure to remind them that additional savings will help them reach their long-term goals faster.

Start Small and Set an Example 

Another helpful tip for your children is allowing them to see how you budget. You can start little by little. Perhaps you can let them assist you in planning out your weekly grocery shopping needs. Start by planning a list from sale flyers and coupons, and then stick to that list at the store. This can turn into a saving game for them. Remember, children will learn from your example. Telling them about budgeting is important, but it’s much more impactful when they see you following a budget yourself. 

Encourage Smart Saving, Sharing, and Spending Habits 

At GOLD, we’ve got Youth Accounts that are designed to teach kids how to manage their money, save responsibly, and practice healthy financial habits that last a lifetime. 

Need help talking through your options? Give us a call and we’ll help determine which is the best account for you and your kids: 484-223-4200. 

GreenPath Financial Wellness

GreenPath Financial Wellness

Our partner, GreenPath Financial Wellness, provided this blog content. GreenPath is a national non-profit organization whose mission is to empower people to take charge of their financial futures. As a Member of GOLD, you have access to GreenPath’s educational tools and resources that are geared to help you along your journey of reaching financial success. 

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