How to Teach Kids About Saving Money

What the experts say is the best way to teach kids about money.
1 of 3

It’s never too early to get your child started on the basics of investing and smart financial habits. These are values that they will carry with them throughout their lives. But according to Chia Zhi Ling, a master trainer for the Wealth of Life Training Series, children need to have the right mindset before learning about investments. “To be successful financially and in life, we need to have the right perspective towards money (good money beliefs and habits). And the right values (using money for good and with integrity),” he explains.

saving money, kids, parenting

“The earlier children learn and understand about earning interest in comparison to spending, the better they will be at managing money as they grow up,” says Lee Siew Fong, a trainer at GProvision Sdn Bhd.  Preschoolers can be taught the value of things, such as what money can and can’t buy, and start the habit of saving. In primary school, they can learn to differentiate between needs and wants, plus how to make good decisions and be an influencer instead of succumbing to peer pressure. You can also instil in them the importance of working smart to earn money and achieve their dreams.

This is just as important as setting academic and life goals, and should be done consistently as your children grow up. “In the current world of instant gratification, we hear many kids and even young adults saying things like, ‘I want this and I want it now!’ Many of the younger generation feel that they’re entitled to everything,” Zhi Ling explains. “When children learn to set financial goals, they learn that material things come with a cost.”Parents should also explain that the money being saved or invested is actually for a specific purpose, such as tertiary education. “Learning to save up to buy a dream house actually starts from learning to save up to buy a toy,” says Zhi Ling.


Everyone, and even more so children, should start saving as early as possible. Help your children develop this healthy habit.

Set up a savings account
Encourage them to put part of their daily allowance and angpaos into a savings account. Many financial institutions offer savings accounts specially tailored to those under 12 or 18. For example, Maybank and Public Bank’s children’s saving accounts offer cash awards for academic excellence in exams from PT3 up to SPM. CIMB Bank gives out points redeemable for cute merchandise to encourage saving.

Spending within a budgeted amount is also a form of saving. “For younger kids, show them the difference in price for the same item across different brands. As for older kids, give them a budget to plan a family vacation or involve them in the purchase of a car or computer,” suggests Choo Soo Eng, a financial advisor representative from Capspring Temasik Financial Group.

1 of 3