Explain the difference between necessities (milk, toothpaste, a warm coat) and luxuries (candy, toys, jewellery) and how money must be allocated to needs first. Use real-life examples that kids can understand: "We need a place to live so we have to pay our mortgage, but we only want to go on holiday, so spending money to go to Disney World is a want." Also, teach your kids about delayed gratification. You want a big toy? You wait for your birthday or Christmas, and similarly we have to learn to wait and save for what we want. This is a concept they can put into practice by earning money through chores to save up for a wish-list item.