How to Teach Your Kids Financial Patience

Could you leave your young child alone in a room for a few minutes with a fluffy, sweet marshmallow…and trust him or her not to eat it until you get back? What if you promised a reward of a second marshmallow if your child waited? Could he or she do it?

Not entirely sure? You’re not alone. Self-control is a really tough task for kids—and most grownups, too, when sweets are involved!

The Famous Marshmallow Test

In the 1960s and ‘70s, a Stanford University researcher named Walter Mischel actually conducted a psychological experiment with kids and marshmallows (and some other treats). The Marshmallow Test became legendary. It’s been recreated and filmed many times. Mischel also recently released a book about his experiment and its implications.

The bottom line: Helping your child learn to “delay gratification” may be a key to helping them be financially successful. It may also help your kids in other parts of their lives—working to improve their grades, avoiding drugs, not overeating, etc.

Why the Wait?

Can your child give up something they really want right now in order to wait for something better down the road? For instance, can a young child skip buying candy today and save their money to buy an Xbox game in a month? Can teenagers occasionally skip having lattes with friends in order to save up for a car?

Financial experts like Beth Kobliner and Farnoosh Torabi and say absolutely yes. After all, when your kids are adults, the stakes will be higher. They may need to trade all sorts of day-to-day purchases so they can save for a vacation, house, retirement, etc.

4 Ways to Teach Kids to Wait

You can help teach kids financial patience—starting right now:

  • Offer a modest allowance. Even if you can afford more, pay your child just a little less. Make sure they’ll always have to save up for a few weeks, or even months, for bigger purchases.
  • Require waiting periods. Whenever your kids want to pay for an item or experience over $x (you set the limit)—even if they already have the money—make a rule that they have to wait. Have your child note the item on a family calendar and wait two weeks (or more for bigger buys). Hint: It also helps if you, the grownups, model this same behavior.
  • Have older kids pitch in. Don’t automatically pay in full for your teen’s school trip to Disney Land or that new phone. Let your teen earn some of the money with a job or extra assigned chores at home. You’ll automatically build in some waiting time as your child works and saves.
  • Be cautious about loans. Tempted to advance your child a few extra bucks when they’re short of money? Don’t do it. Let your kid save up or work more and wait. Particularly when kids are new to managing a bit of own money (even a small allowance), it’s good to set a family rule that you won’t loan money or pay allowances ahead of schedule.

Be clear that it’s not OK for your kids to borrow money from friends, either. You want your budding tycoons to realize that they should only buy things when they have enough of their own money in hand. Credit lessons can come later.

(photo courtesy © Ken Bosma cc2.0)

How To Talk Money Management With Your Kids

The money talk — not as scary as the birds and bees, but still a lot to think about. We get it and so do other parents. In fact, 49% of parents say they’re not sure how to explain money to their child.[1] Enter: Spring Break. It’s the perfect time to open the conversation, starting with budgeting. 


If you’re like 67%[2] of Americans, you keep a budget — nice! Time to get your kids on board. But how? You could start off by explaining why a budget matters, because chances are they’ll ask.

Conversation Starter: “When you make a budget, you know just what you’re spending, and how much you need to save for things you want, like those AirPods.”


Fixed Expenses and Variable Expenses — ring a bell? Maybe, maybe not. Either way, they’re important words to teach your kids about budgeting. Break it down into Spring Break terms, and they’ll get it.

Conversation Starter: “A Fixed Expense is one that doesn’t change. Like, our plane ticket. A variable Expense is one that does change. Like, meals. It can go up or down, depending on where we eat.”


Budgeting for Spring Break is one thing — saving for it is another. Instead of simply handing them money (and hoping they stash it away), show them the importance of earning and saving.

Conversation Starter: “Saving money lets you buy things that you might not have enough money for right now. When you add a little bit of money to savings over time, it helps make future purchases possible.” Tip: Name something you’re saving for, and how you plan on reaching your goal.


After you have the money talk with your kids (you’ve got this!), think about getting them a debit card — like Greenlight. Unlike a credit card, they can only spend what’s on it. (More on the differences between credit and debit here.) The best part: debit cards like Greenlight empower your kids to make smart money decisions, long after Spring Break ends.

With the Greenlight debit card and app, your kids can:

  • Set Savings Goals. Even staycations cost money. Teach them to save for it.
  • Learn to Make Trade-offs. Keychain or shark-tooth necklace? It’s their call.
  • Earn Allowance Through Chores. Greenlight kids who earn allowance save 26% more.

As they start learning about money management, you’ll be right there with them. The Greenlight app lets you:

  • Control Access to ATM’s. Are they taking too much out? Set limits.
  • Choose Stores. You decide where they can and can’t spend.
  • Get Real-Time Notifications and Monitor Their Spend Levels. Perfect if they’re vacationing without you.


Join Greenlight today and help your kids get a head start on budgeting for the break — and for life! Sign Up Now

[1] [2]

Why kids should understand the difference between debit and credit cards

Today, it’s not surprising that Americans have shifted from the traditional use of cash to more modern methods of payment like debit and credit cards. According to Fundera, 70% of consumers prefer using cards as a form of payment and 54% prefer using debit cards. 

Debit and credit cards provide convenience, more security than cash and are accepted nearly everywhere. It’s safe to say that while cash may not be going away, teaching children the basics of what credit and debit cards are now will prepare them to use cards responsibly in the future. 

Prepare them for the reality of credit cards

A credit card is a form of payment issued by a bank or business that allows the holder to purchase things on credit. When making purchases with a credit card, you promise to pay back the money you owe (plus any interest!) at a later date. 

When you carry a balance over month-to-month, the lender charges you interest on top of the amount you owe. Carried balances and interest can add up quickly and many families find themselves in a position where it’s tough to pay credit cards off.

In fact, 41% of America’s households have credit card debt. It’s important to introduce your kids to the concept of credit cards while they’re still in the nest – that way, they are prepared to carry one later in life. 

When it comes to teaching your kids, we recommend starting their money management adventures with a debit card. This protects them from overspending because they can spend only the money they have, and allows them to build healthy habits early before they enter the world of credit.

Teach them to manage money with a debit card

Debit cards provide more security than cash and fewer worries about debt than a credit card. A debit card is a form of payment that deducts money directly from a bank account to pay for a purchase. With debit cards, owners can have easy access to their available funds and can often also put money aside for something special using a savings account. 

Kids need to learn how to manage a debit card just like they need to learn how to drive. Whether your child runs their own lemonade stand during the summer, starts their first job or gets an allowance, a debit card can help kids learn to manage balances, save money, and more!

How Greenlight helps

Greenlight helps kids learn how to manage money and form strong healthy habits that will serve them as adults. According to Greenlight CEO Tim Sheehan, the reason Greenlight is a debit card is to “help kids learn to effectively manage the money they’ve earned, as opposed to spending money they may not have.”

Parents are the primary account holders and have the controls to choose where their children can use the card, manage chores and allowances, set parent-paid interest rates on savings, and more. Kids are able to monitor their balances, create saving goals, and learn how to make financially-smart decisions in a safe environment with their parents’ guidance. 

How parents send money using the Greenlight debit card.

Mistakes are just mistakes

With Greenlight, there is no chance for a child to overdraft or overspend since we decline any purchases greater than the child’s available balance. Mistakes are just mistakes! Parents get alerts when kids try to spend more than they have to spark conversations about budgeting and wise spending. 

Parents are able to allocate funds to their child’s “Spend Anywhere” account or choose specific stores where kids can spend and how much they can spend. They can even help their child create a savings goal and contribute money to meet that special goal. 

Ready to teach your child how to manage money responsibly?

Join Greenlight today to start adventures in personal finance with your kids!