The clatter of coins dropping into a piggy bank is a sound fewer children will recognise. As physical cash becomes less common, the tap of a card or the click of a button has taken its place.
For parents and foster carers, this shift presents a challenging question: how do you explain the value of money when it has become almost invisible? Teaching children a solid foundation in personal finance is a vital life skill.
This is especially true for children in care, who often benefit from extra support with practical skills before they live independently.
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Make the Invisible Visible
The main difficulty with digital money is its lack of physical form. When a child doesn't see notes and coins leaving their hand, it’s harder to connect spending with a consequence.
A simple but effective approach is to make their digital funds visible. Grab a whiteboard for the kitchen wall or even just a dedicated notebook. Log their allowance or pocket money at the top.
Each time they buy something, update the balance together. Watching the total go down after a purchase directly mirrors the feeling of a wallet getting lighter and makes the abstract concept of spending concrete.
Use Technology to Your Advantage
Rather than seeing technology as the enemy, it can become a powerful teaching aid. Most high street banks provide youth accounts that come with a debit card and a mobile app.
Prepaid cards for young people are another excellent choice, offering a safe space to learn.
You can load funds, set spending limits, and see where their money is going. The real learning happens when you use these features together. Set aside ten minutes a week to go through their spending history.
You can discuss what they bought, praise their saving efforts, and chat about any choices they might now reconsider. This turns a dry bank statement into a practical lesson.
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Adapt the Old Rules for New Tools
The time-honoured method of splitting pocket money into three jars for spending, saving, and sharing is still brilliant for teaching budgeting.
This principle is easily updated for a world without cash.
Look inside most children's banking apps and you'll find features that let you create separate 'pots' or 'vaults'. Help your child set these up and give them clear names, like 'Fun Money', 'Savings Goal', and 'Donation Pot'. If you are a foster carer, some of your fostering allowances should be put towards pocket money.
When their money arrives, guide them as they divide the money between these categories. Doing this encourages them to think deliberately about where their money goes, rather than just spending it as it comes in.
Discuss Wants Versus Needs
One-click checkouts and tempting in-app purchases make impulse spending easier than ever.
That’s why frequent chats about the difference between wants and needs are so important. When you’re doing the weekly shop or they are looking at something online, use it as a teaching moment.
Ask them, "Is that something you really need, or just something you want right now?" or "If you buy that, what does it mean for your savings goal?"
Another great tactic is the '24-hour rule'. If they want to make an unplanned purchase, suggest they wait a day before deciding.
That short pause gives them a chance to decide if they truly want the item, teaching them to be more mindful consumers.
The fundamentals of money management, earning, saving, and spending with care haven't altered.
By making digital money tangible, using new technologies wisely, and keeping the conversation going, parents and foster carers can successfully teach these skills.
Your support will give the children in your care a toolkit of skills and the confidence to manage their finances throughout their lives.
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