Parents often ask me when they should start teaching their children about money. I’ll give it to you in one word - yesterday. You want to introduce your kids to finances as early as possible. How early? Very. As soon as they can count, kids can start understanding the concept of money. Even if you don’t actually give them spending money at this young age, you can talk about money, comparison shopping, and budgets in simple terms even preschoolers can understand.

The Preschool Years Preschoolers can save money, as long as they can touch and see it.  They know intuitively that money is a way of getting what they want.  And they can make decisions about what to buy, as long as they’re given a limited number of choices.  But at this age, kids don’t understand much more.

The Elementary Years Elementary aged students know what money is, but still don’t get the concept of denominations. Kids this age start to show signs of imitating their parents’ spending habits (that can be a bad thing!) but need concrete situations and examples to help them learn about money. The encouraging news is they’re also able to save for a specific item, if the saving time isn't too long.

The Middle School Years Ah, this is when peer pressure kicks in big time! Kids begin showing more interest in money because they try to get peer approval with the things they can buy. Can you say Juicy Couture? But the good news is they’re becoming more capable of longer savings plans. Children at this age also understand the concept of being paid for a job and start looking for ways to earn money. They’re concerned with fairness and can apply their math skills to money issues.

The Teen Years Early teenagers want the financial independence to make their own decisions and may start showing dissatisfaction with the household income. Don’t worry, this too shall pass. At this age, it’s not uncommon for them to borrow money from friends and they also may want to start using a credit card. They’re able to begin saving for long-term goals but they still need help establishing and sticking to limits.

Middle and late teenagers want to be independent and often turn to money to help solve their insecurities. This is a great time to begin teaching kids how to manage credit and let them experience the consequences of good and bad decisions. As much as they think they deserve complete financial independence, they still need your guidance, perhaps now more than ever.