7 strategies to set your kids up for financial success

A parent's comprehensive guide

With everything going on in the world today, lots of parents are realizing how important it is to teach their kids about money early. It's not just about putting money away in a savings account... It's about helping kids build habits and confidence they’ll need to make smart financial choices throughout their whole life.

Kids start learning about money way earlier than most people think. As parents, you're the first—and most important—money teacher they'll have. And good news: you don’t need to be a financial expert to set them on the right path. Here are seven real-life strategies you can use to help your child grow into a financially confident adult.

1. Start early - keep it simple

Anyone at almost any age, even toddlers, can start learning about money. Instead of using a traditional piggy bank, try clear jars so kids see their savings grow. Talk to them while you’re out running errandsand explain how you pay for things at the store or why you choose one thing over another. Those little moments build up in their minds over time.

As your kids grow, you can also give them an allowance tied to simple chores. Just giving them money does nothing. The pay-for-work concept helps them understand that money comes from things that they do. Help them set goals, like saving for a toy or game, and let them track their progress using a sticker chart. Grocery shopping is another great learning opportunity. It can teach them how to compare prices or stick to a budget (which everyone at Wealthist knows is the first thing people should do to grow their wealth).

2. Build credit early (without risk)

One of the best-kept secrets in personal finance is adding your child as an authorized user on your credit card... without actually giving them the card. As long as you manage your card well, your kid gets the benefits of a strong credit history before they turn 18. This trick can help them get lower interest rates on loans and save them thousands of dollars in the future. Remember, it's all about giving them a head-start, not a pile of cash.

Before you do this, make sure your credit card company actually reports authorized users to credit bureaus. And even though kids won't be able to use the card, it's a great chance to start teaching them about how credit works and why it matters.

3. Save smart for college

This one is huge. College is expensive. Like... really expensive. If you want to help your child avoid student debt, the earlier you start saving, the better. A 529 plan is one of the best ways to do this. It’s a special savings account that grows tax-free as long as the money is used for education. Some states even give you a tax break just for contributing.

And it’s not just for college either. 529s can now be used for things like trade schools, K–12 tuition, and even apprenticeships. Other options are custodial accounts, which offer more flexibility but come with different rules. Some parents even use Roth IRAs for dual-purpose savings—money that can be used for retirement or education if needed.

4. Protect their identity

It's not fun to think about, but kids are becoming targets for identity theft. Their credit is a clean slate, which makes it wildly attractive to scammers. One thing you can do is freeze their credit with all three major credit bureaus. It’s free, and it blocks new accounts from being opened in their name without your permission.

Once your child hits school age, it’s always smart to check their credit once a year. They shouldn’t have any credit history at all, so if something pops up, you’ll want to catch it early. And don’t forget to talk about online safety. They should understand things like creating strong passwords and should never really be sharing personal info online.

5. Teach them how investing works

Investing might sound way too advanced for kids, but it really shouldn't be. You can start by showing them how money grows over time through compound interest. Maybe use a chart or a simple story... like how Warren Buffett got inspired to invest after seeing one as a kid. Seeing a billionaire starting at the same place that a kid is at now could have a big impact on how they think about money.

There are even games and simulators that let kids create pretend portfolios and track how their "investments" perform. If you want to go deeper, you can open a custodial investment account, which gives them real-world experience, but with your guidance. And everyday headlines can even be great teaching tools. When a company makes the news, ask your children what they think that means for its stock price.

6. Encourage entrepreneurial thinking

Kids don't have to wait until they're adults to earn money or solve problems. Things like lemonade stands or craft businesses can teach lessons about money, marketing, and having grit or resilience. If your child wants to earn money, help them find real ways to do it. They could do things like help neighbors, sell something they made, or start a service that the community needs.

Instead of jumping in to fix every problem they run into, ask questions that help them think through it themselves. Problem-solving is a huge part of financial success. And if they learn that early, they’ll be way ahead. We like to say, "Prepare the child for the road, not the road for the child."

You can even introduce them to younger entrepreneurs through YouTube or books. The more they see what’s possible, the more they’ll believe they can create something of their own.

7. Focus on more than just money

Being good with money isn’t just about numbers, it’s about values, emotions, and mindset. Talk to your kids about how emotions can affect spending. Teach them what it means to spend money on things that really matter to them, instead of just following what their friends are doing.

Let them feel any mistakes in safe ways. If they blow all their allowance and can’t buy something they really want, don’t bail them out right away. Let them feel the consequences and learn from it.

Mostly, just show them that learning about money is a lifelong thing. Talk about your own financial journey... things you’re proud of or what you wish you did differently. Let them see that it’s normal to keep learning, growing, and adjusting your plan as life changes.

Building a foundation for life

Helping your child grow into someone who’s confident with money takes time, but it’s one of the most valuable gifts you can give. Whether you're teaching them the basics of saving, helping them build credit, or encouraging them to start a mini business, every step counts.

These small actions build a foundation that supports big results. They build financial independence, smart decision-making, and peace of mind. The best part? You don’t have to do it all at once. Just start today, and keep going.

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