How do I teach my 8 year old about money?
By Calm Money Kids · 5 min read
A lot of parents hear the words "but I need it" many times a week once their child is 8. You can teach an 8 year old about money by sorting needs from wants together and by comparing prices before they buy. Eight is a good age for both, because your child can now think through a choice before making it.
What can an 8 year old understand about money?
Most 8 year olds can tell that some things are needed and some are only wanted, once someone shows them the difference. They can also compare two prices and work out which one is lower.
They still think best about real things in front of them, so a store is a better classroom than a kitchen table.
This matters because the words "need" and "want" will shape how your child spends for years. In Calm Money Kids, an 8 year old is a Goal Builder, and the app's activities for this stage include comparing and planning.
What is new about teaching money at age 8 compared to age 7?
At 7, the big lesson was saving for a goal with a name and a date. At 8, the big lesson is thinking before buying.
The suggested allowance goes up to $8 a week. The Spend jar now gets $4, the Dream jar gets $2, and the Grow and Give jars each get $1.
This is also the age to teach needs and wants on purpose. Before now, you only needed to use the words.
When your child turns 9, you can read how to teach a 9 year old about money.
Why should you teach your 8 year old about needs and wants now?
A child who cannot tell a need from a want will feel that every "no" is unfair. Shopping trips turn into arguments, and nobody learns anything.
Once your child can sort the two, they can make sense of how the family spends. They also start to see why their own Spend jar has limits.
How do the four money jars work for an 8 year old?
On Family Money Day, your child splits $8 into four jars. The jars teach needs and wants on their own, because parents pay for needs and the Spend jar is for wants.
The app tracks each jar, so your child can check what they have before they plan a purchase.
The Grow jar gets $1 and keeps growing
The Grow jar stays put until age 18. You keep adding a little extra each month because your child left it alone.
It helps to ask your child to explain in their own words why the Grow jar is for their grown-up years.
The Dream jar gets $2, and your child checks the price first
Your child can save about $8 to $26 in one to three months. Before they set the goal, look up the price in two places together.
Talk about why the same thing can cost more in one store than in another.
The Spend jar gets $4 for wants your child plans ahead
The Spend jar is for wants, and that is a helpful rule for an 8 year old to know.
Ask your child to decide what they want to buy before you go to the store, and see if they can stick to the plan.
The Give jar gets $1, and giving time counts too
At 8, your child can learn that there is more than one way to give.
You can ask, "Would you like to give money this month, or give some of your time?"
How do you explain needs and wants to an 8 year old?
Say you are at the grocery store with your child. Tell them you are going to sort what is in the cart into three piles, which are need, want, and not sure.
Milk goes in the need pile, and cookies go in the want pile. Then you get to something harder, like a new backpack with a favorite character on it.
You might say, "You need a backpack for school. Do you need this one, or do you want this one?"
The "not sure" pile is where the real learning happens, so there is no need to rush to an answer.
How do you teach an 8 year old to compare prices?
Comparing prices matters because it shows your child that the same money can go further with a little thought. It also slows a purchase down, which is half the lesson.
You can start with two sizes of the same snack and work out together which one is the better deal. In Calm Money Kids, you can look at the Spend jar total right there in the aisle, so your child knows what they have to work with.
What are three money activities to try with your 8 year old this week?
All three of these ideas fit into a normal trip to the store. You can pick one for your next shopping day.
- Play the three piles game with five things in your cart, and let your child do the sorting.
- Compare two sizes of the same snack, and ask your child which one is the better deal and why.
- Have your child write down what they plan to buy before you leave home, and check the plan together afterward.
Common questions about teaching an 8 year old about money
How much allowance should an 8 year old get?
Calm Money Kids suggests $8 a week for an 8 year old, which is $1 for each year of age. That is $1 for Grow, $2 for Dream, $4 for Spend and $1 for Give.
Should my 8 year old pay for their own needs?
No, parents pay for needs at this age. The Spend jar is for wants, and the Dream jar is for a bigger want that takes time.
What if my 8 year old says every want is a need?
That is very common, and the "not sure" pile helps. Ask what would happen if they did not have the thing, and let them think it through.
Help your 8 year old think before they buy this week
An 8 year old can learn a lot from one trip to the store. Two simple questions, "is it a need or a want?" and "what does it cost somewhere else?", will serve them for life.
Calm Money Kids keeps each jar up to date, so your child always knows what they can spend on a want.