Did you know that in 2015, the Straits Times Business section reported that over 85,352 Singapore consumers have overdue unsecured debt totalling $288.4m? And the number keeps increasing every year. There’s clearly a problem with the way we manage our money. That being said, it’s a wonder why good money management skills aren’t being taught in schools.

On the other hand, we can’t possibly expect schools to teach our kids each and every life skill out there. That’s why we, as parents, need to impart these types of skills to our kids.

Ask yourself: Do your kids even know where money comes from? Money is invisible to them because we tend to pay with NETS and credit cards everywhere we go. It’s no wonder that kids have a hard time wrapping their heads around the concept of money.

If you want to help them understand money better, the first step is to be more open and vocal with them about everything surrounding money. In an age-appropriate way, of course.

To help you out, here are 7 strategies that you can implement right away to teach your child some basic money management skills:



The ATM – a magical box where mummy and daddy get an endless supply of money. Kids need to know the reality though. Spend some time explaining to them that money is earned by doing work. They may not grasp this immediately, so don’t be afraid to set them to work to earn their own money. Just be careful not to pay them for doing the chores that they should already take responsibility for, like making their beds or cleaning up toys after play. Faye De Muyshondt, author of “socialsklz (Social Skills) for Success: How to give Children the Skills They Need to Thrive in the Modern World” suggests instead to pay them for helping out with special chores like washing the car or cleaning out the fridge.


When you pay them the money they’ve earned, be sure to do so periodically (for example, every Sunday), instead of immediately after the task is completed. Once they’ve collected their pay, ask them what they want to buy with it. If they decide to blow it all in one go, don’t be too quick to intervene. Let them experience overspending first-hand. When they realise they have nothing left that week, and have to wait a whole week to get their earnings again, they would have learnt a lesson in overspending.


Money management lessons are best taught as a part of everyday life. The next time you take your child with you to the supermarket, bring a $50 bill with you and tell her that this is all we have to spend in the supermarket. Her eyes will naturally wander around the shelves and before you know it, she’ll be asking for a pack of chocolates or cookies. Add the total expense up as you place items in your cart, and tell her that buying everything will bring your budget over $50 and that it’s important to choose your purchases wisely to keep within budget. She will learn that careful choices need to be made when you have limited funds and a budget.


You don’t need a fancy piggy bank to do this. Just get your child an empty jar, and show her what happens when she starts putting part of her earnings (or allowance if she gets one) into that jar. To keep her motivated, take note of how much money she collects as she saves. Tape a piece of paper onto the jar and add the sums up as she saves. Want to be even more effective? Set a spending goal with her. Identify an item she wants, and write the price of the item down next to the saving tally. As the savings reach her goal and she gets to reap the rewards of her efforts, her motivation to save will soar.


Money is not just for spending. Teach your child that money can also be used to help others. Start by noticing what she cares about, and talk to her about it. Does your child point out that a little girl at school wears only old clothes and shoes? Tell her that there are other little kids that could use help to buy clothes, books and shoes, and she can give part of her money to an association that helps them. Do you have a pet cat that your child adores? Tell her that there are many cats out there that don’t have loving homes, and if she shares some of her money with them, the shelter can help look after them till they find loving homes.


Why not help your child to start out her own small business? If she is talented at handicraft, show her how she can sell her crafts to neighbours and friends for a sum of money. If you don’t have an artistic child, don’t give up. She can also offer simple services like dog walking, typing documents, or babysitting.


The fact is, no matter what you teach your children, they learn most by example. So practise what you preach. Make shopping lists before you shop and stick to them. Be vocal about your values surrounding money and share it with them when you are at the ATM, at the supermarket or paying your monthly bills. When you buy something that you need instead of want, share your decision-making process with them – why you chose to sacrifice something you wanted for something the family needed. As much as you can, use cash when spending money around them.

Start now!

Beth Kobliner, author of the New York Times bestseller Get a Financial Life, says that children as young as three years old can grasp financial concepts like saving and spending. So don’t underestimate your little one. As soon as they know how to count, you can start to educate them about managing money!