Last updated on Jun 21st, 2021 at 12:22 pm

By Sarah-Jane Meyer

Give your kids a head start by setting them up to manage their money effectively and get onto the property ladder

Teaching children, teens and young adults the value of saving money will enable them to become home owners at an early age, putting them firmly on the path to wealth creation. Once they have learnt the basics of earning in order to spend, save, share, and invest wisely, they need to repeat the process over and over. As with learning any skill, practice makes perfect.

Lead by example

Your kids will see how you handle your money, and will tend to follow your lead. If you are constantly spending above your means, they’ll assume it’s normal behaviour. To set them up to make money work for them you need to lead by example and ensure your own money management systems are effective.


The first step in teaching your kids the importance of managing their money is instilling the idea of earning their own money, rather than having it given to them. The key is to repeatedly demonstrate and demystify the relationship between work and money – when you work, you get paid; when you don’t work, you don’t get paid.

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To get this point across it’s important not to give your kids money for doing nothing. Pay them for the chores they do around the house like taking out the dustbins, cleaning their rooms, washing dishes, or mowing the lawn.

Allocating funds

Any time your kids get money you should encourage them to divide it between spending, saving and giving. It’s a good idea to have separate containers – or bank accounts for older children – for each category. The key, though, is to allow your kids to choose how to allocate the money, as well as what they do with it.

Discuss what they will do with their money as well as how they could have split their money up differently. Ultimately, though, it should be up to them to decide how to distribute their funds.


When your child wants something it’s the perfect time to teach them about spending wisely. Instead of them looking to you as the provider of their wants, let them provide their own. Remind them that they have their own money, and they can decide if they want to spend it on whatever it is they want. This will teach them to stop and think about how to value the money they have.

Emphasise that once their money has been spent, it’s gone. In the long run you are teaching them to live within their means — and that’s really the only way to win with money


Giving is another important aspect of money management, because it teaches kids to feel the impact of helping others at a young age. Let them choose the charity or person they would like to support.


Saving is an essential component of money management, as it is one of the cornerstones of wealth creation. You need to encourage your kids to put a portion of their money towards savings each time they get paid for doing chores, or when they receive gifts of money on birthdays or other occasions.


Once they have saved up a fairly large sum, you should encourage them to invest some of this in suitable investment vehicles, such as unit trusts, or they may be keen to start a small business for which they will need venture capital.

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By the time your kids are old enough to earn a living, their money management skills should be well-established, and they could perhaps consider investing in property.

Many millennials – defined as individuals born between 1977 and 1994 – are at this stage now, and some of them are finding the going quite tough.

According to research and analytics group, Lightstone, Millennials can expect to spend 3.04 times more on their first-time home than the generation before them, because of the rate at which house prices have increased over the past decade or more.

Having the necessary money management skills will enable them to save for a deposit, as well as have the necessary discipline to repay a long term mortgage loan.

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Author: Private Property