As parents, one of the most valuable gifts you can give your children is a solid understanding of money management. Teaching kids about banking and personal finance early prepares them for financial independence and equips them with the tools to make informed, responsible decisions when they’re older.
For Filipino families—where the values of hard work, saving, and providing for loved ones through honest means are deeply ingrained—these lessons take on even greater significance. Teaching children to respect the value of money helps them understand the sacrifices made by their parents, ensuring they carry these values forward as they grow. Furthermore, these lessons can be seamlessly incorporated into everyday activities, which makes the learning process engaging and practical.
With that being said, here are key concepts that parents and guardians can use as a starting point for teaching young ones about banking and responsible finances:
1. Understanding the Value of Money
One of the most important things to teach kids about banking is understanding that money is earned through hard work. Children need to realize that money doesn’t magically come from an ATM or a parent’s wallet; rather, it comes from effort, time, and skill.
For many families, this lesson can be demonstrated through familiar everyday activities. You can teach your child the value of earning by giving them small tasks such as sorting groceries or watering plants in exchange for a small commission. If your family runs a sari-sari store or small business, involve your child in basic operations, such as stocking shelves or handing out change.
2. The Basics of Saving
Saving money is one of the most important habits kids can and should learn early on. One way to teach kids about banking is by introducing the concept of a piggy bank as a tangible way for your child to store their money. Let them watch their savings grow with each deposit, reinforcing the idea that small amounts, when saved consistently, add up over time.
Once they’re ready, introduce the concept of a savings account in both traditional and digital banks. You may want to take them to a physical bank branch to experience traditional banking methods or use your own mobile device to show them how to use banking and finance-related apps.
Since kids nowadays are naturally inclined toward technology, it may be easier for them to grasp the concept of saving through banking apps. If you have a Maya savings account, for instance, you can show them how digital transactions work and how these bank apps help users save and grow your money securely. You can also demonstrate how to pay bills, transfer funds, or buy items using Maya e-wallet. Also, emphasize the importance of security, such as keeping passwords private and recognizing phishing attempts.
You can also explain how interest works in simple terms. For instance, you can say, “When you keep your money in the bank, the bank adds a little more money to it every month as a thank-you for keeping it there.”
3. Spending Wisely
Another important concept to teach kids is how to spend their money wisely. They need to understand the difference between needs and wants and how to make thoughtful decisions about their purchases.
You can start by explaining that needs are essential items like food, clothing, and school supplies, while wants are things like toys, video games, or snacks. Use real-life scenarios to help them decide what’s more important. When grocery shopping, let them help you choose between brands to find the most cost-effective option, teaching them to evaluate quality and price.
To reinforce this lesson, have your child create a “wish list” of items they want. Ask them to rank their list based on importance and explain their choices. This helps them learn to prioritize and understand that they can’t always buy everything they desire.
4. Budgeting Techniques
Budgeting is an essential skill that lays the foundation for financial responsibility. To teach kids the concept of budgeting, offer to help them manage their allowance. Break their money into three categories: Save, Spend, and Share. For instance, if they receive ₱100 per week, encourage them to save ₱50, spend ₱40, and set aside ₱10 for giving to others.
If your child doesn’t receive an allowance, you can let your child handle a small amount of money and budget it for a specific event or activity. For example, ask them to organize the family’s merienda for one afternoon. Then, ask them to work within a specific budget to buy ingredients. This activity shows them how to make decisions and trade-offs based on limited resources.
5. Goal Setting and Patience
Last but certainly not least, teaching kids to set financial goals and practice delayed gratification helps them develop discipline. Encourage them to save for specific objectives, such as a new toy, a favorite book, or even a family trip. Let them set a timeline and work toward achieving their goal, teaching them that good things are worth waiting for. You can also use Maya Personal Goals as an example of how to set specific objectives and the simplicity of using digital banking to set aside funds for what you want to achieve.
For longer-term goals, help them break down the savings into smaller, achievable steps. This approach keeps them motivated while instilling patience and determination. Additionally, celebrate their milestones to make the process exciting. When they reach a savings target, reward them with a small treat or organize a fun family activity. Acknowledging their efforts reinforces the habit of saving and gives them a sense of accomplishment.
Financial literacy is an essential life skill that your child can start developing early and at home. When kids learn about banking and money management as soon as possible, they will be better equipped to build a secure financial future. Consider teaching these lessons mentioned above to set the foundation for independence, discipline, and responsibility.
By starting early, you can teach your kids about banking in ways that are simple, fun, and meaningful.