When Moneta principal and family CFO Matt Ring was in elementary school, his mother made an arrangement with him: He was given four envelopes—one each for savings, spending, gifts and charity—and every week when he was awarded his allowance, Ring had to divvy up the money among the categories. It is a lesson that resonated with him, and he now uses the envelope system with his own young son. “Even at an early age, it was a good tool to set the stage for budgeting and managing money,” Ring says. “In a simple way, it helps create self-discipline when it comes to finances.”

In today’s high-tech world, it often is more complicated to teach your children about financial responsibility, but laying the foundation as early as possible remains critical, and parents are the best resource for that education. “You can start teaching as soon as your children learn to count,” says Dino Cannella, M&I managing director and regional senior VP. Using a piggy bank and helping youngsters recognize the values of bills and coins are ways to start that dialogue.

As your child reaches elementary-school age, the lessons can evolve into allowances, envelope systems and lemonade stands to create a better understanding of wants and needs. Everyday life provides multiple opportunities for those lessons, Ring explains. “A trip to the grocery store where you compare prices, or explaining to your children how an ATM works, will help them learn how money is earned and spent.”

Setting good examples for your children often is the best way to impart financial wisdom. “Your children are going to copy you, so you should talk openly about money with them,” says Aaron Sestrich, VP of private banking at The Business Bank of St. Louis. “Parents may be apprehensive about sharing how much they make and spend, and I don’t think you have to—showing them the process is the most important part.”

The increase in technological accessibility can be both a burden and benefit to educating children about finances. The lack of paper money and physical trips to the bank in the digital age eliminates key opportunities for teaching moments, and parents often give in to their children’s demands for the latest state-of-the-art—and expensive—toy. “Our kids don’t need the latest and greatest of everything—we need to teach them discipline when it comes to spending,” Cannella notes.

Technology also can help teach that discipline. M&I’s Helpful Steps for Parents website provides detailed advice and tips to help parents create careful consumers within their children. In addition, other online resources like budgeting programs can be of great use as children reach high school and college and become more financially independent. “The automated programs are much more appealing to the younger generation,” Sestrich says. “They’re a lot more impactful than a checkbook register.”

Those years spent building the groundwork for fiscal responsibility will be tested when your children head off to college. If they are unprepared, it can be a difficult learning experience, especially when they are enticed by the many credit card offers that pile up in the mailbox. “If your children start taking out credit cards, they’ll find out the hard way when they realize they’re not in the financial position to pay those bills,” Ring says. “That can hurt their credit scores, which can affect them way beyond college.”

With less than 32 percent of Missouri parents teaching their children about finances on a regular basis, according to a survey done by M&I, young people may not be getting a vital education that should start at home, Cannella says. “With the economy as it is, and the fear of Social Security funds running dry, it’s more important than ever to teach our children and grandchildren about spending, budgeting and saving so they can become financially responsible adults.”