Talking About Money with Young Children
"Does money grow on trees, Mommy?"
Okay, so that's not really a question asked by one of my kids, but it absolutely could've been! After all, money isn't the easiest concept for young children to understand. How to earn it, how to use it, why some things have a greater monetary value than others… That's a lot to learn, so why not start at an early age?
Here are a few ideas for activities and conversations you can have with children to get a jump start on the importance of managing money well.
The Piggy Bank: a Classic!
Did you have a piggy bank when you were a kid? I did and I loved counting its contents! My children each have their own little piggy bank where they keep the money they're given or find. Of course, managing money as an adult is about more than cash, and we don't use cash as much as we used to, but it's a place to start for kids. Touching and counting money firsthand gives them a deeper understanding of the economy and different values of each coin and bill.
Play Shopping
Role playing games are often very popular with children. Pretending to be in a store with a cashier and a customer helps to simulate a day-to-day scenario that focuses on understanding the value of money. As kids get older, have them practice in real stores with you.
Talking About it Openly in Front of Them
Was money a taboo subject when you were growing up? It was in many families, but the tide is turning, and it's becoming more and more natural to talk about money as a family. This is a great way to teach children good financial habits. Feel free to talk about the price of their favourite treat, or explain why it's not always possible to buy toys at the store, for example. Explain how the family budget is allocated and the impact that unexpected purchases can have on the whole family.
Planning a Savings Project with Your Child
Maybe your child is dreaming of a new toy, but Christmas and their birthday are both a long way off. Why not teach them how to save, so they can buy it with their own money? Show them in a tangible way how to save for something they really want. Give them a way to earn some money, whether by helping with household chores or by offering services to friends and family. This will help your child understand the effort involved in making money. They might even change their mind about buying that toy, deciding it's not worth all the effort they put into raising the necessary money.
By engaging your children early about the importance of money management, they'll be more likely to understand that money doesn't grow on trees. And, most importantly, they can gradually develop good money habits—a valuable learning experience that will last a lifetime.
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