Age-by-Age Money Milestones: What to Teach When
- LearnWithEbba
- 1 day ago
- 8 min read
By LearnWithEbba | November 2025
My daughter Ebba is 18 months old. She can't talk yet, but I'm already thinking about the money conversations we'll have.
Not because I'm anxious. Because I'm prepared.
After 15 years managing hundreds of millions for ultra-high-net-worth clients—executing trades worth over 100 million francs, structuring multi-currency loans, advising on everything from equity portfolios to real estate funds—I've learned one critical lesson:
Financial confidence starts young. Much younger than most parents think.
The problem isn't that parents don't care about teaching their kids about money. It's that most of us don't know what to teach at each age. What can a 4-year-old actually understand? What's too advanced for a 7-year-old? When do you introduce investing?
So I've been researching, planning, and mapping out exactly what financial concepts match which developmental stages.
Here's the roadmap I'm following with Ebba—and the one I recommend to any parent who wants to raise financially confident kids.
Ages 3-5: The Foundation Years
What They Can Understand: "Money = Trade for Things We Want"
Developmental reality: Kids this age are learning cause and effect. They understand simple exchanges. Their thinking is very literal and concrete—abstract concepts won't land yet.
Core Money Concepts for Ages 3-5:
1. Money has different forms (coins and bills)
Make it tactile. Let them hold money, sort it, stack it. At this age, they need to see and touch to understand.
Simple activity: Give them a jar of mixed coins. Ask them to sort by type and size. Don't worry about teaching values yet—just recognition.
2. We trade money for things we need and want
Take them shopping. Let them watch you hand money to the cashier and receive items in return. Make the exchange visible.
What to say: "I'm giving the shopkeeper 10 francs, and she's giving us bread. That's how we buy things we need."
3. Money is limited—we can't buy everything
This is a hard concept for young kids. They see money as infinite because they don't understand where it comes from yet.
How to introduce scarcity: "We have 20 francs for snacks today. We can get chocolate OR chips, not both. Which one matters more to you?"
Let them make the choice. Let them experience that choosing one thing means not choosing another.
4. We keep money safe in specific places
Start a piggy bank—preferably clear so they can see the money accumulating. Visibility is everything at this age.
Why it works: Watching coins stack up is tangible proof that saving works. They can see progress.
What NOT to Teach Yet:
Interest rates or investing (too abstract), Long-term planning (their brains can't process "in 5 years"), Opportunity cost as a concept (they can't think hypothetically yet)
Ages 6-8: The Builder Years
What They Can Understand: "Work Creates Money, Choices Have Trade-offs"
Developmental reality: They're developing logical thinking now. They understand that actions lead to predictable outcomes. They can delay gratification for short periods (hours to weeks, not months).
Core Money Concepts for Ages 6-8:
1. People work to earn money
This is when you connect labor with income. Explain what you do for work in simple, specific terms.
My plan with Ebba: "I help people decide what to do with their money so it grows and stays safe. They pay me for that help, and that's how I earn money for our family."
Make your work visible. Let them see you working. Let them understand it's effort, not magic.
2. Some expenses are needs, others are wants
This is THE most critical financial skill you can teach. I've advised billionaires who struggle with this distinction.
The sorting game: Go through your shopping cart together. Point to each item. "Do we need this to live, or is it something extra we want?"
No judgment—just categorization. The goal is developing the mental framework.
3. We can earn money by providing value to others
Introduce the concept of payment for extra tasks (not basic family responsibilities).
How to structure it:
Normal chores (making bed, cleaning room) = no payment (that's being part of the family)
Extra tasks (washing windows, organizing garage) = payment
This teaches that money = value provided, not entitlement.
4. Saving means waiting for something better
They can now understand saving for short-term goals (2-4 weeks out).
The savings chart method: Pick something they want that costs 40-50 francs. Create a visual chart divided into sections. Each time they save 10 francs, color in a section. When it's full, buy the item together.
The visual progress is crucial. They need to see how the small amounts add up.
5. When you buy one thing, you can't buy something else
Introduce trade-offs explicitly.
The scenario: "You have 20 francs. This toy costs 15 francs and that book costs 12 francs. You can only choose one. Which matters more to you right now?"
Let them wrestle with the decision. This is how financial maturity develops.
What NOT to Teach Yet:
Complex investing concepts, Credit and debt (too abstract), Percentage-based thinking (developmentally challenging)
Ages 9-12: The Independence Years
What They Can Understand: "Money Grows, Time Matters, Decisions Have Long-Term Effects"
Developmental reality: They can think abstractly now. They understand future consequences. They're also hyper-aware of social comparisons and fairness.
Core Money Concepts for Ages 9-12:
1. Money can grow over time through interest
This is when compound interest becomes accessible.
How to explain it without gimmicks:
"Imagine you put 100 francs in a special savings account at the bank. The bank pays you a little extra money just for keeping your money there—let's say 5 francs per year. So after one year, you have 105 francs.
The next year, the bank pays you interest on the 105 francs—so you get a bit more than 5 francs. Maybe 5.25 francs. Now you have 110.25 francs.
Each year, you earn interest not just on your original 100 francs, but on all the interest you've already earned. That's how money grows by itself—you don't do anything except leave it alone and let time do the work."
The key insight: Emphasize that TIME is the most powerful factor, not the amount. Starting early matters more than starting with a lot.
2. Real-world banking and saving
Open an actual savings account together. Let them deposit money. Show them the balance growing.
What this teaches: Money in a bank is real. It's tracked. It earns interest (even if it's small). They can watch their wealth grow over time.
3. Budgeting: Dividing money into categories
Give them a monthly allowance and help them divide it into categories:
Spend (for whatever they want)
Save (for bigger goals)
Give (charity or helping others)
The percentage split I'll use: 50% spend, 30% save, 20% give
Let them manage this themselves. Some months they'll run out of spending money. That's the lesson.
4. Investing means putting money to work
Don't overwhelm them with stock market details. Just introduce the basic concept:
"When you invest, you're putting your money into companies or projects that can grow. If the company does well, your investment grows with it. It's riskier than a savings account, but over long periods, it usually grows faster."
Real example: "If you invest 100 francs per month starting at age 12, by the time you're 30, you could have over 50,000 francs. But if you wait until you're 22 to start, you'd only have about 25,000 francs by age 30—even though you invested for the same number of years."
This demonstrates the power of starting early better than any abstract explanation.
5. Advertising exists to make you want things
They're old enough now to understand persuasion tactics.
The conversation: "That commercial made that toy look amazing, right? That's the advertiser's job—to make you feel like you NEED to buy it. But do you really want it, or did the ad just convince you? Wait 24 hours. If you still want it tomorrow, maybe it's worth it."
This teaches critical thinking about consumption.
6. Opportunity cost: What you give up when you choose
Make it concrete:
"You want to spend 60 francs on this video game. That's fine! But it means you won't have that 60 francs for something else. What else were you thinking about buying? Are you sure the game matters more?"
The goal isn't to stop them from buying things they want. It's to make them think through the trade-offs first.
What NOT to Teach Yet:
Tax strategies (let them enjoy being kids), Complex investment vehicles
Ages 13+: The Young Adult Years
What They Can Understand: Pretty Much Everything (But Gradually)
At this stage, they're ready for real-world financial practice with supervision.
Key concepts to introduce:
1. Credit and debt: Explain how borrowing works and why interest rates matter. Show them real numbers: "If you borrow 1,000 francs at 18% interest and only pay minimums, you'll end up paying 1,500 francs total—that's 500 francs wasted."
2. Investing with real money: If possible, open a custodial investment account. Let them pick a few stocks or funds. Let them watch the ups and downs. Real skin in the game creates real learning.
3. Taxes: When they start earning money, show them the deductions. Explain where taxes go and why they exist.
4. The power of starting early: Show them compound interest calculators. Let them play with the numbers. The visual impact of starting at 15 vs 25 is staggering.
The Milestone Nobody Talks About: Financial Confidence
Here's what I learned after 15 years in wealth management, from trading floors at UBS to advisory desks at Deutsche Bank:
The richest clients weren't always the most financially confident. And the most financially confident clients weren't always the richest.
Financial confidence isn't about knowing every term or making perfect decisions.
It's about:
Feeling comfortable talking about money without shame or stress
Understanding that money is a tool for living your values
Knowing you can figure things out when you encounter something unfamiliar
Making decisions aligned with what matters to you
That's what I want for Ebba. That's what we should want for all our kids.
The Most Common Mistake Parents Make
Waiting until kids are "old enough."
Financial education should start at 3, not 13. The earlier you start, the more time the lessons have to compound.
(Yes, financial education compounds just like interest. Small lessons repeated over time create extraordinary understanding.)
My Challenge to You
Look at this roadmap and identify where your child is developmentally.
Pick ONE concept they haven't been exposed to yet.
This week, find a natural moment to introduce it.
Don't force it. Don't make it a formal lesson. Just weave it into daily life.
That's how financial literacy actually builds.
Want Help Getting Started?
I've created a free Age-by-Age Financial Literacy Starter Kit with conversation prompts, activities, and a printable milestone tracker so you know exactly what to teach when.
It's the guide I will be using with Ebba—and I'm sharing it with families everywhere.
What age is your child, and what money concept are you most nervous about teaching? I'd love to hear what's challenging you.
About Hermina
I'm a wealth management professional with 15+ years advising ultra-high-net-worth clients across Zurich and London—from equity trading at UBS to managing portfolios worth hundreds of millions. Now I'm channeling that expertise into LearnWithEbba: helping families build financial confidence through practical resources and storytelling. My daughter Ebba is 18 months old, and I'm already planning the financial foundation I'll help her build. I'm also writing a children's book that teaches investing through magic—because our kids deserve better than boring money lectures.
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