I am a firm believer in the earlier the better when it comes to teaching children about money. Financial responsibility is something that is learned over time, and sometimes through difficult lessons. In today’s tough economy, we have to be very mindful about finances and careful to spend our money wisely. There are fun ways to teach kids about money, in a way that will have a lasting impact and help them become financially responsible adults.
Teaching Children About Money
For younger children start with the basics. Teach them to identify money and learn the value of bills and coins. Once these basics are established, you can move onto making change. The grocery store game is a fun way to teach this skill. Set up a grocery store in your home using items found in your kitchen and add price stickers or tags. Let your child go shopping and then pay for the items with either your spare coins or play money.
Understanding that things cost money is also an important lesson for younger children. Has there been a time when you told your child that you could not afford something, and they replied saying that you could just write a check for it or put it on your credit card? It’s important for kids to learn that credit cards and checks aren’t a free money. Teaching your child that everything from cable television to the dinner on the table costs money will give them a better appreciation and understanding for the value of money.
Grade school is the perfect time to start giving children an allowance for chores. It’s a great way for them to learn that money doesn’t grow on trees, instead is earned. Encourage your kids to save their allowance up for something special that they want.
For more ideas check out the article 12 Things I Want My Kids To Know About Money.
Unfortunately I have had my two oldest daughters tell me to just charge something they wanted, I had to explain to them that I do not have a credit card. It is definitely a good idea to teach children that money doesn’t just fall into our laps. Great post!!!
I think it’s important to start teaching them young! Great tips! 🙂
Good advice! We don’t have any credit cards (got off THAT roller coaster 3 years ago when we did the Dave Ramsey plan – we’re now debt free aside from our mortgage!) but we do have times when our kids will just ask for something and say “Well it’s only XX amount of money!” We respond, “Well do YOU have that much money? What makes you think we do?” It’s a good lesson for them to learn that money does NOT grow on trees.
It’s definitely important to teach children when they’re young so they don’t make foolish mistakes when they are adults.
It’s important for kids to learn about money early on. Kids don’t know how their parents earn money and introducing them how to earn money through chores is a great way for them to learn that money doesn’t grow on tree.
with my step son, my husband and i decided to give him some ‘financial freedom’. its kinda like an allowance. its just $50 a month to spend on what he wants because we kept saying ‘no’ to everything. he has learned to budget his money every month. most of it goes to food (taco bell). we hope he learns that that is not the best thing to spend money on but he will only learn on his own. as for chores, we dont take money away if he doesn’t do them. we punish him if he forgets. since thats now how money works in the real world, why teach them that if you do your job wrong, you get a pay cut! for me, i just get yelled at by my boss and lectured. not a pay cut. so anyway – just my point of view!
It sounds like you’ve got him off to a great start!
We’re def. getting to that point with my son that he should be able to understand the basic concept that things cost money. I don’t want him to grow up thinking that we don’t work hard for the things he has. I like the idea of setting up a grocery store. : )
I think teaching about finances is part of the larger goal of giving kids the skills and values they will need – not a stand alone conversation.
I taught my daughter early and she manages her money better than I ever did.
This is very important to show them how to save money and def. will teach my son to this … thanks