Fun Money Lessons for Children
Watching money in action is a great way for kids to learn about how it works and what it means. There are many opportunities to turn everyday activities into money management lessons. You probably have your own, but here a few ideas to get you started.
At the grocery store. Children love making grown-up choices, so give them a budget and let them be in charge of selecting one or more items on your list. Before you go shopping, clip coupons together and reward them with the money you save.As they get older, hone their bargain-hunting skills by showing them how to comparison-shop, how to spot deals, and the differences (and cost savings) between generic and brand names.
At the restaurant. Whether you’re eating take-out or dining out, give children a set amount of money and instructions to order a healthy meal. They’ll practice budgeting and learn to check for what’s included with their meal. As they get older, introduce them to the concepts of tax and tipping.
Playtime for the very young set. Set up play stores or restaurants with toy cash registers, coins, and groceries/food items.
At the ATM machine. Talk to your children about where money comes from, that you’ve earned it by working, and that you can only withdraw as much as you have in your account. When they’re older, have them press the buttons and enter transactions at the bank machine.
Paying bills. When you’re paying bills online, show kids that things like watching TV, using the phone, and turning on the lights all have to be paid for. While you’re at it, talk about the difference between wants and needs, and the value of planning for long-term goals.
Education tip: Paying with cash rather than credit or debit cards will help your children understand how money is exchanged for goods and services. Let them figure out how much to give the cashier and verify the change. Ask for your change in small bills or coins to gives children an opportunity to recognize money and count it.
The entrepreneurial spirit. Support your child’s interest in starting a business. From traditional lemonade stands, paper routes, lawn mowing, or selling crafts, children feel empowered by earning their own income. Use this fun opportunity to help them understand input costs (for the lemons, sugar, and cups), revenue and profits.
Saving. Consider giving your young children three piggy-banks — for saving, spending, and charity. Let them decorate the containers and have them help decide what proportion of their income (including allowance, gifts, or tooth-fairy money) goes into each. Swap piggy-banks for a real savings account around age 10.
Some folks I’ve heard do four piggy-banks just to make the math easier for their children. Saving, spending, charity and rainy day planning.
Money and the use of it can be taught most anywhere.
Much of this information was presented by “the Vault” from Scotiabank.