top of page

Leading your kids down the right financial path

For any project, it’s a good idea to ‘Start with the end in mind’. This applies when building a house, starting a business or writing a book.

This approach makes it a lot easier to make decisions as you simply take the option which will help you reach the end goal you have in mind.

Why am I talking about this?

As money is such a taboo subject, the financial future of most kids is never really discussed or considered. As a result, their financial future depends on a series of financial decisions they make as they grow up which can lead them down different paths. Some good. Some bad.

Without a goal your kids' financial future is uncertain

We should think of our kids' financial future as a project and have an ‘end in mind’. We can then help our kids take actions which lead them down paths towards a financially healthy future.

Gaining more certainty about their financial future

If we want our kids to grow up financially healthy, then we need to start by helping them picture what financially healthy looks like.

Action: Get your kids to describe what they would like their future to look like. Do this on paper or create a presentation on a computer. They should include what type of house they want to live in, where they want to live, the type of car they want (if they want a car), types of holidays they want to go on. Don’t put any limits on this (read more about this here).

Hopefully your kids will come up with some awesome ideas about their future.

The next thing you need to do is help them understand what is required to achieve this goal. This doesn’t have to be detailed. The key is to help them understand that to achieve their goal they need to make decisions which will lead them towards it.

For example, if they are given some money for their birthday, then they have to decide what to do with this money. If they decide to spend it all, then they are not taking an action aligned to their goal. They will hopefully see that if they want to achieve their goal, they’ll need to save at least some of their money.

This doesn’t just apply to decisions about money. If they have a goal in mind, it can help them make better decisions about doing their homework and how they treat people.

Give your kids a financial goal helps them make great money decisions

No single decision is going to determine whether or not they achieve their goal. It’s the combination of lots of small decisions. Therefore, the sooner they start going in the right direction, the more likely they will achieve their goal.

Remember, if they make similar decisions all the time, it will become a habit and they’ll be moving towards their goals without even thinking about it. Conversely, if they don’t think about their goal, then they could form other habits which drive them away from their goal (i.e. spending all their money).

Let’s not leave our kids’ financial future to chance.

Guide your kids to happiness

Whilst our kids should be in control of what they want their future to look like, as parents, we should think about what we want for our kids. I hope you want your kids to grow up ‘happy’.

Whilst money in itself isn’t the driver of happiness, a lack of money can make people very unhappy.

Here’s a chart illustrating long-term happiness based on how much you Spend vs. Save (there are many other aspects to happiness but I’m isolating the spending vs saving decision here).

Getting the right balance between spending and savings is key to happiness

At one end, we have people who spend all their money. Whilst spending a lot of money can bring a great sense of joy in the short-term, continual spending is likely to result in overspending (bad debt), and stress, when money is needed but there isn’t any. This isn’t a happy place to be in the long-term.

At the other end there are people who save a significant proportion of their money. They don’t dare to waste any of their money. These people will feel secure in times of emergencies but are missing out on the joy of spending money on themselves and others. Whilst better than spending all your money, it’s not optimal.

In the middle are the people who find a good balance of spending and saving. They spend some of their money on things that make them, and those they care about, happy whilst also having some money saved which is growing for the future.

This next chart is important as this is setting our ‘end in mind’ for our kids' financial future. As we want our kids to head towards the middle of this chart, then this should act as a motivator for us all to encourage our kids to make decisions which are aligned to this end goal. This means encouraging them to save a bit of the money they receive for the long-term, i.e. start following the 3 Rules of Wealth.

Remember, our kids form many of their adult money habits by the age of 7, so the more we act now to steer them in the right direction, the better. We all know how hard it is to change habits as we get older.

Make sure your kids learn to save and spend to grow up happy


Our kids’ financial future will be determined by the financial decisions they make as they grow up. Our job as parents should be to encourage them to think about what they want their financial future to look like so that they can make money decisions which put them in the right path towards that future.

Helping your kids form the habit of saving a bit of money when they are young will increase their chances of achieving their desired financial future and, also increases the likelihood they grow up financially healthy and happy.

To learn more about helping your kids look after their money, please read our 3 Rules of Wealth blog.

“There are dreamers and there are planners; the planners make their dreams come true.”

Thanks for reading!


P.S. The above doesn't just apply to kids. If you feel you should be saving more, set yourself a money goal. You'll soon be making better money decisions which will lead you towards that goal.

Our master class consists of 5 short videos which will help your kids (age 10+) learn the essential money skills. Topics include Rich vs Wealthy; Tax; Debt; Investing; Gambling; Scams and many more.

Now only £12.50 (US$17). Start changing your kids financial future here.


bottom of page