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The 3 S’s of Money

Financial education is a valuable tool for people of any age. When children learn money management principles when they are young, they establish valuable life skills that can help them remain free from financial stress throughout their adult lives. Education should begin at a young age and focus on simple principles that can be expounded over the years. One way to teach children about managing money is by using the Three S’s approach.

The 3 S’s of Money

The 3 S’s of Money are Saving, Spending, and Sharing. This approach helps children learn saving and budgeting skills. One way to implement this approach is by using “The 3 Jars” method. Each jar represents one of the 3 S’s of Money, and children can practice putting a designated portion of their cash and coins into each jar. Similarly, older children can use the same practices within bank accounts and spreadsheets. By focusing on the 3 S’s, parents can help their children prepare for a life of stress-free financial management.


The first “S” of money is saving. Saving is an essential principle of good money management. The earlier a child learns how to save money aside, the easier it will be for him or her to continue the practice into adulthood. Saving typically falls into one of two categories: long-term wealth building or saving for a specific expense.

Parents should have a discussion with their children about the goals of their savings funds. For example, the goals could be starting an account for lifelong savings and investments, or saving for a car, a video game, or a trip to Disneyland. Because saving can be challenging for children (and adults!), it’s important for them to learn the purpose of saving. By giving up something they could have now, they give themselves something better later.

Parents can help determine the amount to set aside, for instance 10% of income. The child can put this amount into their Savings Jar and watch it slowly increase, then deposit the money into a savings account when the jar is full. By teaching these savings and goal-setting behaviors, parents can lead children to financial health that lasts a lifetime.


Money for spending falls into two categories: wants and needs. Typically, parents take care of most of the needs, allowing children to spend all of their spending money on wants. But as children grow older and become responsible for more and more of their own needs, it’s important to teach them proper budgeting skills. This means teaching them to control their money and decide where it goes. In other words, it means teaching them to distinguish between wants and needs. This can be challenging when those lines are blurred – a need quickly becomes a want when there is a luxury version available. For example, a teenager might need a car, but the latest sports model would fall into the category of a want.

In addition, it’s important to teach children the Golden Rule for spending: never spend more money than you make. Young children might not understand how it’s possible to spend more money than they make, but one thing makes it possible. CREDIT. Parents should teach children about credit at a young age so they are prepared to manage it when they become older teenagers and those credit card offers start pouring in. 


Sharing money can be challenging, but highly rewarding. There is an old adage: the more you give, the more you receive. Parents often teach young children to share their toys with their siblings and other children, and so it should be with sharing money.

Parents can help children set aside a designated amount of money, such as the recommended 10%. They can put this into their Sharing Jar and use it to share with churches, hospitals, homeless shelters, and people in need throughout the community. In their early years, it’s especially beneficial to help children see how their Sharing Money is helping others. For example, parents can take children shopping for homeless kits using their Sharing Money, show them how the church uses their money for humanitarian aid, or deliver groceries to a neighbor.

In addition to teaching good money management habits, the practice of sharing money teaches children principles of gratitude. By sharing their money, they gain a greater appreciation for the money they have. Encouraging the behavior of gratitude and giving in the next generation can foster a commitment that lasts a lifetime.


The Three S’s of Money is just one of many ways to teach children about money management. The important thing is to teach children smart budgeting habits and wholesome practices. 

In conclusion, it’s never too early to start teaching children money management principles. The earlier they learn, the easier it will be for them to create habits they carry into adulthood. The lifelong habits of saving, spending, and sharing will stay with them even as their budgets get more detailed and complicated over the years, and the principles they’ve learned will help them remain free from financial stress.

Find out how 101 Financial’s Workplace Wellness program teaches money management principles.

Watch the video lesson The Three S’s of Money from the children’s financial education course, The ABC’s of Money with Alan Akina.