How to Teach Your Children About Taxes (and Make it Fun)

"Teaching Your Children About Money" - Tom's Story

I remember holding my first tax refund check when I was 20, shocked that the government “gave” me money, and too embarrassed to ask anyone why.  How did you first learn about taxes?  Today’s article will show you a powerful way of teaching your children about income taxes, refunds and employment – equipping them before they enter the real world.

Welcome to my 10th interview in a series called “Teaching Your Children About Money”.  I’m so excited about today’s teachable moment for two reasons:

  1. This is a hands on, practical method of teaching taxes in a way that kids will understand.
  2. This is the first teachable moment brought to us by a DAD!

Today’s contributor, Tom Swan, is a lifestyle coach and father of seven.  Like me, he got his start in the finance world, helping others one on one and teaching financial classes.  Today you can find him helping people navigate through life’s struggles on his blog,


Please tell us a little about yourself and your family.


I am a writer, speaker and lifestyle coach with a background in financial literacy.  I am also a son, dad, husband, grandpa, painter, plumber, chef, taxi driver, maid, lousy golfer, horrible auto mechanic and part-time comedian. By now I hope you are smiling.

I am married to the most wonderful woman on the planet!

Together we have seven children. My wife and I were foster parents for about nine years and we have adopted three children including twins that are 6, both girls.  One is all about dresses and hair bows while her sister would not be caught dead in a dress. My youngest son is 9 and has his own website.

We have four grown children who are living successful adult lives, going to school, paying rent and realizing that being an adult is harder than it looked as a teenager. I am extremely proud of the four of them! My oldest son, Travis, went to school to be an auto mechanic and is working in his field. My son, Austin, is attending a culinary arts school studying to be a master chef. My daughter, Katelyn, is attending college and is working towards her arts and science degree. My oldest daughter, Trisha, is taking a break from school to focus her attention on being a great mom to our adorable grandson.


What teachable moment regarding your children and money would you like to share?


I think one of the best things you can do for your children is to teach them about independence. Independent people earn a living and don’t come back to borrow money from mom and dad when they are in their thirties.

We try to prepare the children for the reality of adulthood by creating a culture that emulates the real world.

I want them to understand that you go to work to earn money, but you have family responsibilities that don’t yield a paycheck. After all, this is how it is when you become an adult.  No one pays my wife to cook or clean the house and I don’t get paid for mowing the grass.

In order to teach this valuable lesson, we have established jobs that generate a weekly paycheck and chores that are done because you are part of the family.

Each child is given age appropriate jobs, they are taught our expectations and if they complete their weekly jobs, they earn a pay check.  The maximum you can earn is based on the jobs.


The “Dad Tax”

Twenty five percent is withheld for dad taxes (this money goes directly into their savings account). This represents the amount Uncle Sam will take in income taxes when they get a real job. Since most youngsters would get all of this money back when they file their taxes, we give them a chance to get a refund too.

***If you have older children, schedule the tax return around back to school shopping time. If they want the designer labels, they can use some of their cash.


What is the most rewarding part of the experience for you?

Knowing that my kids will be prepared to live successful independent adult lives.


What is the most challenging part of the experience for you?

Accountability!  Just like in the real world if you don’t do the job you are hired to do there are consequences. I use the same system:

  • I use a verbal warning
  • Then a written warning
  • Then maybe termination from that job

Don’t confuse the consequences here.  Your boss would not ground you for not completing that report, so reserve grounding and loss of privileges for chores that don’t get done, not jobs that don’t get done.

[Tweet “”Prepare children for adulthood by creating a culture that emulates the real world.” @AskTomSwan”]


When you were a child, what was your favorite money moment?


I did not grow up rich.  My mom sewed my clothes and my grandma reused disposable silverware.  We used coupons and lived on a budget.

I learned about money at the age of eight, when I got my first paper route. By the time I was nine, I was doing two paper routes and mowing my neighbors’ grass.

My favorite money moment was when I had saved up almost enough to buy a ten-speed bike.  I remember being just a few dollars short.  So I went to my paper customers and ask if I could collect for their papers early and that meant I would get my tip early. It worked perfect; I may have even gotten a few extra bucks in tips by explaining my dilemma to my customers.


Let’s say a young couple with a newborn sits beside you on a bus.  They lean over and ask you, “What are the three most important things we should teach our child about money?”  What do you tell them?


  1. Teach your children that money is the reward for hard work. Without the effort there is no reward.
  2. Teach them to save for the future, for retirement, emergencies and things they want.
  3. To be generous with their money. For God loves a cheerful giver.



If you have enjoyed this article please share it with your friends and family.  To learn more about Tom Swan, you can visit his website at or you can stay connected with him on Facebook at  Have a question; send him an email at


This article is part of an ongoing series called “Teaching Your Children About Money”.  If you have a teachable moment to share, please feel free to tell me about it at lauraharris(at)piggybankdreams(dot)com.

Join the Discussion:  When and how did you first learn about taxes?

Leave a Reply

Your email address will not be published. Required fields are marked *

CommentLuv badge

This site uses Akismet to reduce spam. Learn how your comment data is processed.

2 thoughts on “How to Teach Your Children About Taxes (and Make it Fun)

  1. I love this idea! I need to start book marking all these great posts on teaching kiddos finances. We don’t have kids yet, so I want to remember all these tips when the time comes!

    • So glad you’re enjoying this series, Katie! It’s exactly why I started it. I thought of all the things I have yet to learn, so I figured there are probably other parents (or future parents) wishing they knew this stuff too. Feel free to check out my board on Pinterest called “Teaching Your Children About Money” if you want to save these ideas!