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Teaching Kids Saving and How to Invest

Use this saving game to teach your kids the power of saving and how to invest their money

Kids learn personal finance by doing but get bored too quickly with the usual methods of balancing a checkbook or running a budget. Making personal finance a game they can play and win helps to keep the lessons interesting and teach them lifelong money habits.

Today’s essay is by Aidan Coll, a student at the University of Connecticut. He shares how his parents created a great personal finance game that taught him saving and eventually how investing his money would pay off.

Check out Aidan’s story and please share on social media. The most-shared essay on how parents can teach their kids about money will win our $500 personal finance scholarship, announced August 31st!

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How My Parents Taught Me to Save and Invest

When I was five years old, my wallet was an unsuccessful hotel. Dollars visited every now and then, but they never stayed longer than few days at a time. More often than not, the hotel remained empty. If I received twenty dollars for Christmas, it vanished by New Years. If Grandma gave me five dollars on a trip to Connecticut, it was gone before she could make it back to Pennsylvania.

In short, I never saw the point in saving money; dollars merely correlated to the number of baseball or Pokémon cards they could buy.

Noting my casual relationship with money, my parents sought to instill within me the value of saving. The time may have been better spent teaching leaves not to change color in the fall, but they accepted the challenge nonetheless.

As strong proponents of independence, however, they could not simply force saving upon me. Certainly not. Instead, they created an incentive structure strong enough to make saving irresistible; they created the “Monus”.

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How to Turn Personal Finance into a Learning Game

The structure’s title was a combination of the word “bonus” and the name of our Yellow Labrador, Monahan. It was refreshingly simple. At the beginning of every week, each of the four children would receive an allowance of $1.50. There was one catch. If one of us had no money in the bank on Sunday evening, he or she would receive nothing.

Not only did receiving nothing while others collected their spoils hurt, but it also made qualifying for the next week’s Monus exponentially more difficult. Consequently, spending money with reckless abandon was no longer an option.

Within a few months, my bank account hovered around fifty dollars, a small fortune. Playing cards and candy still caught my eye, but my newfound wealth unlocked a world of possibilities. In addition to dollar store items, I could now consider big-ticket items, like remote controlled cars and baseball mitts. Fascinatingly, I did not even have to buy these items to enjoy them; simply having access to them gave me pleasure. I continued to save.

Good Saving Habits Turn to a Great Investment

By the time I reached middle school, my parents added a new feature to the system. In addition to the old rules, they would now double (yes, double!) every contribution we made to our savings accounts. Once again, however, there was a catch. Once doubled, money must remain in the savings account until the child responsible for depositing it graduated high school.

The deal was obviously fantastic, but the prospect of saying goodbye to hard-earned cash for years on end was difficult to stomach. Despite initial reservations, I eventually invested upwards of ninety percent of my net worth in long-term savings.

How should you invest to reach your financial goals? Check out this easy guide to investing by age for how to change your investments over your lifetime.

At the end of the day, the most valuable contribution of the Monus system did not come in the form of its weekly payments on Sunday nights. As a college student, I place far greater value on the knowledge and habits with which it provided me.

These days, when I receive a paycheck, my first thought is, “where is the most effective home for this income?” Investing it for double may no longer be an option, but utilizing stocks and bonds is a nice consolation prize. My baseball card collection may have been fuller without my parents’ advice, but I can say the same for neither my brain nor my bank account.

I want to thank Aidan for his essay on how a personal finance game helped teach him how to save and invest. Be sure to support Aidan by sharing the article through social media and check in August for the winner of the personal finance scholarship.

Joseph Hogue, CFAAbout Joseph Hogue

An investment analyst by profession, I run two blogs (Crowd101 and PeerFinance101) in personal finance, peer lending and crowdfunding. I've been on both sides of the table as a lender and a borrower and am excited to be a part of the peer movement. With the power of the internet, people are helping other people manage debt and raise money in ways never before possible.

A veteran and Iowa-native, I now live in Colombia with my wife and son. Like so many people, I was once trapped into the money myth and what it means to be successful. After taking control of my finances and learning how to make money in a job I love, I found a level of financial freedom that just has to be shared.


  1. BETTS SLIM says:

    I like Aidan’s essay on finance

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