Parents are encouraging their children to be more financially independent, sooner. Gen Alpha kids — born from 2010 onwards — are already learning how to manage money and set themselves up for financial success.

Teaching kids about money starts at the kitchen table

Empower research shows that two thirds of American adults never learned about personal finance in school and half say that money wasn’t discussed at home. But times are changing when it comes to explaining money to kids.

According to a survey of 2,000 Gen Alpha parents — 70% of them Millennials — teaching children about financial responsibility is being introduced as early as they learn their ABCs and 123s. More than half of parents have already chatted with their child about spending, saving, and budgeting, and different types of money like cash and credit, often before age 4. Some parents have also opened CD accounts, money market accounts, or a Roth IRA for their kids.¹ Providing financial literacy for kids from an early age is becoming a priority for parents.

Read more: 5 building blocks of financial literacy

Mini-money managers

Anticipated to be the largest generation yet, Gen Alpha is expected to have the greatest spending power in history: By 2029, their economic footprint is estimated to reach more than $5.46 trillion.²

Millennial parents of this generation are motivated to set their children up for financial success. A 2024 study found parents are currently creating an investment strategy with their child (41%), sharing logins so they can make online purchases (39%), and sharing a finance app (37%).³

At the same time, teens are taking financial education into their own hands, learning through state-level courses, non-profit programs, and social media. Some teens are even starting investment portfolios before they graduate high school.

Read more: Teens take financial literacy into their own hands

How to teach kids about money

In many ways, building financial literacy for kids can begin with the same building blocks that underpin financial responsibility in adulthood: Spending wisely, saving often and early, and informed investing. How to teach a child financial responsibility varies by age, but getting started with these essentials can help Gen Alpha kids gain positive money habits early in life:

Explain the value of money and where it comes from

Money can bring freedom and responsibility. Teaching kids the value of earning money can be an important first step in financial literacy. Providing a regular allowance for completing chores can help children develop a strong work ethic and begin to understand how to make choices about spending and saving.

Teach them how to budget

Once children have some money to manage, parents can consider introducing how budgeting works. As kids start spending and perhaps set their sights on a purchase that exceeds their allowance, parents can introduce the idea of setting aside a certain portion of their hard-earned money to save for the long run.

Introduce investing

When to introduce the basics of investing will likely depend on when an individual child has a good understanding of the foundations of spending and saving. When it seems appropriate, parents may choose to open a custodial account to help kids gain a sense of ownership and an understanding how they can potentially grow their money over time.

Keep it fun

Incorporating financial education into daily life is a great way to keep kids engaged in learning about money — be it at the grocery store, when they ask for a new toy, or as parents make their own financial decisions. How to teach kids about money may look a little different from family to family. Still, having open conversations about money and modeling positive habits can be key to setting children up for success with financial responsibility.

A head start on financial freedom

Professionals suggest that what parents do is just as important as what they say to kids about money: Avoiding money talks with children could mean they may pick up unintended messages and adopt less-than-desirable habits.⁴

Giving children some financial responsibility — in the form of an allowance, for example — is one common way that today’s parents are creating opportunities for learning and conversation.

More than two-in-five of Gen Alpha’s parents give their kids an allowance, and around half of those say their kids can spend some of their own money without parental restrictions.⁵ The going rate for a weekly allowance is $45 a week on average, according to one study.⁶

About one in three little Gen Alphas earn money through online selling or reselling, and almost half (47%) do odd jobs outside the home such as babysitting. Most commonly, they’re getting paid to do chores (69%), or as a reward for good behavior or grades (73%).⁷

Helping hand 

Despite their own economic concerns, most (77%) of Gen Alpha’s parents are very or somewhat confident in their child’s future financial security.⁸ But that’s not to say they wouldn’t welcome more help for building financial literacy in their kids.

Only 22% of parents are “completely confident” in their ability to teach their children the basics of investing and they’re looking to their kids’ schools for help.⁹ All else being equal, 74% of parents said they would move their children to a different school if it offered financial education and investment courses.¹⁰