The Most Wonderful Time of the Year… to Talk About Money.

The holiday season brings excitement, but it can also be a source of stress if you’re not prepared. Families often find themselves managing travel arrangements, buying gifts, and donating to causes they care about—all while celebrating the spirit of giving.

Yet, the holidays can also put a strain on our budgets. This makes it a great time to focus on building financial literacy within your family and creating a holiday budget together. Teaching your kids about managing money during the holidays is one of the most effective ways to instill important financial habits.

While this conversation might seem intimidating, financial literacy doesn’t require complex calculations or spreadsheets. You don’t need to break out a mortgage statement or your checkbook. Instead, it’s about forming healthy spending and saving habits, and starting early is key. After all, research has shown we begin forming our financial habits as early as age three.

Here are a few ways to involve the whole family in creating a financially responsible holiday season:

1. Establish a Budget Limit: The first step is to set a spending limit that works for your family’s financial situation. Take into account your income, any seasonal expenses, and other financial obligations. Once you’ve established a budget, include your kids in the process. They don’t need to know exact numbers, but involving them in understanding the overall expenses—like travel costs or favorite family traditions—can help them appreciate the importance of sticking to a budget.

   
   

2. Discuss What Matters Most: Have a conversation with your kids about what they want to prioritize this holiday season. Whether it's buying gifts, taking a trip, or participating in special events, help them identify what matters most. Once you’ve figured out their top priorities, work together to allocate the budget effectively to meet those needs. With many decisions to make at this time of year, they’ll not only appreciate having a voice in what is decided, but will likely enjoy it more knowing the thought that goes into it.

   
   

   

   
   

3. Show Them How to Save: Teach your kids the value of saving for things they want. Whether through an allowance or earning money from chores, encourage them to save for their holiday desires. Explain that patience and planning can help them achieve their goals, even if they can’t get everything right away.

   
   

4. Be a Role Model: Finally, lead by example. Show your kids how you manage your own finances during the holiday season. Share your goals, challenges, and the decisions you make to stick to a budget. By doing so, you’ll demonstrate that budgeting and financial responsibility are essential skills that will serve them well throughout life.

   
   

Children are often more aware than we realize. With all the ads, sales, and packages arriving at the door, they’re paying attention. That’s why it’s important to remind them that while the holidays are a joyful time, they’re even more special when we make thoughtful choices about spending.

For more tools and activities to teach financial literacy at home, explore FitMoney’s free, unbiased curriculum for all K-12 students and families.