Teaching kids about money: Saving, investing and games
Published on 31st March, 2025 at 08:47 am
While it’s easy to explain the difference between saving and spending, the difference between saving and investing can be fuzzy for many of us. By talking to our kids early on, and helping them to start investing, we can set them up for success.
Reading time: 5 minutes
In this article you’ll learn:
- How to talk about investing and saving with kids
- What age to start
- How to help your kids when you lack money confidence
How to explain savings and investing
Saving is putting money aside for short-term goals while investing is about putting money into assets that can grow over time to meet long-term goals. No doubt about it, investing can get complicated, but the basics can be kept simple enough for kids to understand and engage with them.
Audrey Tan, a product and marketing associate for gamified financial literacy programme MoneyTime, says that explaining savings and investments to kids will be most effective when connected to their everyday experiences and familiar scenarios.
If your child gets R100 for their birthday, they could choose to put that money in a piggy bank (savings). “It stays safe, and you can use it later, but the amount doesn’t grow over time,” says Tan.
Alternatively, they could buy something that will grow in value (an investment), like planting a seed that turns into a fruit tree. It might take time, and there’s a chance it won’t grow as you expected. However, if it flourishes, the rewards can be much greater than what was initially planted.
The difference? “Saving keeps your money safe for later and helps you buy things soon. Investing helps your money grow over time, but it involves some risk and patience,” says Tan.
Read more from our Big Concepts for Little People series: How to teach kids about interest and Teaching kids about credit.
Use video games
To help kids grasp these concepts, you can draw parallels between saving/investing and activities they already enjoy, like video games.
“For example, you can explain to kids that if they play Minecraft, saving is like gathering diamonds and storing them in their chest for later. Investing is like using those diamonds to craft stronger armor and tools,” she says. “This takes up resources, but it helps them survive longer and mine even more valuable things!”
If your child is an Animal Crossing fan, try this scenario. “Saving is like keeping their Bells (game money) in their account, so they don’t run out. Investing is like buying turnips in the Stalk Market. If they sell them at the right time, they can make a lot more Bells! But if prices drop, they might lose money.”
Use Monopoly
Monopoly can be a great way for teens to experience the difference between investing and saving, says Tan. Here’s how you can frame or tweak the game:
- Investing through property purchases: Buying properties, especially with upgrades like houses and hotels, is like investing. The higher rent can grow your wealth, but they come with upfront costs and some risk.
- Savings account: Encourage players to hold onto some cash rather than spending it all.
- Decision-making discussions: When players land on low-value properties, ask them if they’ll invest in this property or keep the cash for future opportunities. Discuss long-term outcomes.
- Post-game reflection: After playing, discuss which strategies worked best. Did saving give a stable foundation? Did investing pay off, or was it too risky at times? How did the balance between the two affect the final score?
When to start the conversation
Talking about savings and investments requires a progressive approach. Tan gives some pointers for each age.
- Age 8-10: Introduce basic investing concepts using simple ideas like earning rewards over time – such as planting a seed that becomes a tree
- Age 11-12: Kids can now grasp concepts such as risk vs reward, compound interest, and long-term growth through their real-life experiences
- Age 13-18: Teenagers can start learning about real-world investing, such as stocks, index funds, possibly even with a small, supervised investment account.
What if you’re not confident about your own money skills?
“Many parents avoid money talk because of past mistakes. Reframe this as an opportunity for discussion and share your own stories of saving and investing,” says Tan. “When you as a parent make mistakes or face financial challenges, discussing these experiences openly can show your kids that learning and bouncing back is part of managing money.”
Read up on investment basics.
“Parents don’t need all the answers. Teaching kids about money can empower both generations at the same time,” she says.
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