Money safety tips: teaching kids to keep their money safe

Money safety tips: teaching kids to keep their money safe

Your kids may be tech-savvy, digital natives, but that doesn’t make them immune to online fraud. According to the Federal Bureau of Investigation’s internet crime report, young people under 20 lost a total of $101.4 million to hackers last year. 

 

So what can parents do to help protect their children from scammers? Here are 12 money safety tips to teach kids:

  1. Don’t give out your details to anyone 
  2. Be wary of untrustworthy sites
  3. Don’t take photos of cards and sharing with others

  4. Don’t use public wifi
  5. Beware of fake communications
  6. Know what scams to look out for
  7. Don’t click on links you don’t recognize
  8. Keep passwords and PINs private
  9. Choose strong passwords
  10. Be vigilant when shopping online
  11. Regularly check spending

  12. Use a prepaid debit card over carrying cash

1. Don’t give out your details to anyone 

Cybercriminals are crafty. They’re always coming up with new ways to trick us into handing over our identities online. Sadly, all too often they succeed. Child identity fraud costs US families nearly $1 billion a year and affects 1 out of 50 children

 

The first, most important, lesson to teach your children is to keep their personal details private. 

 

Talk to your kids about boundaries with people they meet online. They should never give out identifying information like their name, SSN and address to anyone. This doesn’t just apply to emails, text, and chat, but when downloading apps or playing games, too. 

 

For younger children, who may not be able to grasp what identity fraud means, you could just make it a rule. They never give out their name, address or age to anyone. 

 

You may also want to restrict internet access. Research shows the earlier kids go on the internet the more likely they are to experience identity theft. 

2. Be wary of untrustworthy sites

If a website is badly designed with lots of pop-ups, it may not be legit. Train your kids to look for signs a website is one they can trust.

  • Is there an SSL certificate proving its connection is encrypted?
  • Does it have ‘http’ (not secure) or ‘https’ at the beginning of its URL?
  • Is the lock icon showing in your browser window?

If your children aren’t sure, encourage them to check with you.  

3. Don’t use public wifi

Using public wifi is a bad idea. Open networks—think coffee shops, train stations, and airports—are typically unsecured. It’s far too easy for a hacker to get in between your device and the connection point and steal your data. Teach your kids to wait until they can use a secure network instead.

4. Avoid posting photos of cards and documents online

Explain to your children that sharing photos of cards and documents online is risky. It’s an open invitation to identity theft. 

 

Sure, your teen will be delighted they passed their driving test and upgraded from a learner’s permit to a full license. But just think what personal information they’ll be revealing. Their full name, address, date of birth, height and weight, unique ID number and even a photo of themselves. 

 

To avoid identity theft warn your kids not to share photos of:

  • Credit or debit cards
  • Bank statements
  • Driver’s licenses
  • Medical records
  • Health insurance cards.

5. Beware of fake communications

Teach your kids to be wary of e-cards, emails, texts, calls, or social media messages asking them to:  

  • Reply with their personal information
  • Visit a website for authorization
  • Enter personal data in pop-up windows.

They are all scams. Alert them to the signs it’s a fake request. For example, 

 

Did they contact you first? 

 

When you contact a business, you know who you’re talking with. But when someone contacts you first, you can’t be sure they are who they say they are. Email addresses and caller IDs can be faked.

 

Did they offer a prize?

 

If an offer seems too good to be true, it probably is. Be wary if someone dangles bait like a prize, free access to a game, or a gift card, for doing nothing except parting with your personal information.

 

Impress on your children that it’s always best to pause and think carefully. Then ignore, delete and block. Again, if they’re not sure what to do, encourage them to come find you and ask. 

6. Know what scams to look out for

Key to avoiding a scam is being able to recognize one. Phishing, smishing, vishing, and aren’t just fun names that sound suspiciously like Hogwarts-lingo. They’re all social engineering scams designed to play on your kids’ emotions and trick them into giving out personal information. 

 

Here’s a quick run-down of the scams your children need to look out for if they want to keep their money safe. 

 

Phishing

Phishing attacks can be via email, text or an app. The goal is to trick you into giving your personal information—like passwords and card details. 

 

Pharming

Tries to trick you into visiting a fraudulent website without you realizing it.

 

Spamming

Uninvited emails and texts. Most spam is advertising but can include malicious links.

 

Vishing

Like phishing but over the phone. The caller ID is often faked to trick you into thinking the call is legit. 

 

Water-holing

Tries to take advantage of the trust you have in websites you visit often. Hackers get into the site and insert pop-ups or links to click taking you to untrustworthy sites. 

 

Scams aren’t so scary when you know what to look out for. Red flags are:

  • Asking for a PIN
  • Asking for your social security number
  • Asking you to download an attachment or fill out a form
  • Misspelled words
  • Asking for your address
  • Asking for your birthday
  • Using scare-tactics.

 

Teach your children to avoid clicking on links in emails or texts they weren’t expecting. They should also be wary of messages that appear to be from their friends but seem "off" or have no genuine personal message attached.

7. Don’t click on links you don’t recognize

To see if a link looks genuine, try hovering your mouse over it. The URL will appear on your screen. But it’s always safer to manually type in a URL instead of clicking on a link. Especially if you want to visit an online bank, store, or payment website. 

 

To stay safe, avoid clicking on:

  • Links in emails
  • Ads on websites
  • Social media messages
  • Messages in chat rooms
  • Links sent to you by people you don’t know.

8. Keep passwords and PINs private

Passwords and PINS are meant to keep your data safe from cyber thieves. To do that, your kids need to keep them private. 

 

The best way to store passwords safely is to use 2-factor authentication wherever you can. It gives you another layer of protection if someone does get hold of your password. 

 

If your child uses their browser password manager, impress on them the importance of having a master PIN number. Skip that step and anyone who hacks into their device will have access to everything. 

 

Memorizing lots of different passwords can be tricky. If your children insist on writing them down, suggest they write them in code. They could try tricks like using hints, or noting one word that’ll jog their memory. If your children do this, make sure they don’t carry them around with them. They’re safer stored somewhere secure at home.

9. Choose strong passwords

Explain to your kids why using the same password on every site is a bad idea. Once hackers get a password from one site, they’ll try it on every other one you visit. 

 

As well as using different passwords, have them change these every few months. Remind them to check they receive an email confirmation each time, too.

 

Here’s how to create a strong password:

  • Use at least 12 characters
  • Don’t repeat characters
  • Mix numbers, uppercase and lowercase letters, and symbols.

10. Be vigilant when shopping online

Sit down with your kids and talk through the ways they can protect their money when they’re shopping online. Remind them always to check the site’s security by looking for the lock symbol in their browser and ‘https’ in its URL. 

 

Other red flags would be if the store has no reviews, is offering suspiciously big discounts, or there’s bad grammar and spelling. 

 

Explain how it’s best not to store your card details on a site. It’s safer to type them in each time you buy something online. And use sites with 3D Secure or SCA authentication at checkouts. It gives your child extra security when they make payments online.

 

Here are a few online shopping safety basics for children:

  • Only shop on secure websites
  • Check reviews 
  • Avoid shopping on public wifi
  • Use a secure payment method preferably with 3D Secure/SCA
  • Never store your payment information online
  • Double check totals and email receipts.

11. Regularly check spending

Get your kids in the habit of checking their card and bank statements regularly. Keeping a close eye on their account means they’re more likely to spot any suspicious activity. If they do see charges they don’t recognize, explain why they should contact their bank or card company immediately. 

 

If your debit card is lost, stolen or hacked, you should tell your bank within two days of any unauthorized activity. If you do,  the most you can be liable for is $50. 

12. Use a prepaid debit card over carrying cash

We’ve talked about how to help your kids keep their money safe online. But what about cash? 

 

When your kids are out and about, it’s safer to keep their coins in a purse, or dollar bills tucked into a wallet rather than stuffed loose into their pockets. 

 

It’s safer still to use a prepaid debit card than carry cash. Here’s why:

  • If your card is stolen you’re not liable for unauthorized purchases made with it.
  • It’s easy to keep track of your spending as transactions are automatically recorded online. 
  • If your card comes with an app, you’ll be notified every time there’s a transaction. 
  • If you do see something suspicious you can freeze your card in-app and contact your bank to let them know so they can investigate.

What’s more, a debit card is convenient. There’s no fumbling around in your wallet for bills, or digging in your pockets for the exact change. It’s less bulky to carry around too. And as it doubles as an ATM card, you always have access to cash if you need it. 

How GoHenry can help keep your child's money safe

A GoHenry prepaid debit card helps keep your child’s money safe. Available for 6-18-year-olds, it gives your kids financial independence and gives you peace of mind. 

 

You can make it extra secure by setting limits for ATM withdrawals, individual purchases, and weekly spending. Plus, you get notified whenever your child makes a purchase.

 

If a card gets mislaid, or you think it’s been stolen, you or your child can instantly block it on the website or app. Loss protection keeps their money safe and you can replace their GoHenry card for free. 

Money safety missions

Even better, GoHenry can teach your kids money safety in Money Missions, our fun, in-app educational tool. Designed to accelerate your child’s financial literacy your kids learn to be money smart through interactive games and quizzes. As they go up levels they earn points and badges too. 

 

Money safety is just one of the Money Missions topics covered. Your children also learn other core money management skills through missions on spending, saving, budgeting, credit, investment, and more. 

 

 

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Written by Charlotte Peacock Published Dec 15, 2022 ● 10 min. read