Few lessons are as important for your children than financial responsibility. Of course, you’re not going to start off by teaching your preschooler about credit cards, interest, stocks and bonds, but there are many fun activities that help instill good money habits in young children. Here are a few of our favorites:
Start with Cash
The concept of credit is beyond the comprehension of most young children, but making purchases is not. Take your child to the store and offer a small amount of cash to purchase a toy or a treat. Allow your child to hold the money and watch as it’s exchanged for goods. Even letting children use coins to set the parking meter, buy a drink from the machine or even turn the knob on the gumball machine will help them understand the concept of paying for goods and services.
Open a Family Store
Teach your child about purchasing without spending extra money by setting up a family store. Even if your little one is too young for an allowance, you can still reward work with pay using play money. Ask your child to complete various chores and place a dollar amount on them. As the tasks are completed, pay your child with play money. Then, set up a “store” of goodies, whether that’s candy, toys, special outings or anything else that holds value to your child. Be sure to place a reasonable price on everything offered at the store. As your child earns “money,” allow him or her to spend it at the family store.
Classic board games are a great way to teach children about money. While Monopoly teaches children about saving, investing and even paying taxes, there are plenty of other games, as well. The Game of Life helps children understand earnings and living expenses, Payday helps children understand budgeting and meeting monthly expenses, and Charge Large introduced children to the concept of credit and debt.
Use the Money Savvy Pig
Traditional piggy banks have served as sources of saving for generations of children. But money isn’t just for spending anymore. The Money Savvy Pig teaches 21st-century kids about money’s different uses. The transparent piggy bank has four chambers, one for each of the money-management choices children will face as adults: saving, spending, donating and investing.
In what ways have you taught your children about saving money?