It’s never too early to start teaching your child about money. Even a preschool-aged child is capable of distinguishing between coins and their different values, learning the concepts of spending, earning and paying. In fact, every day our children are exposed to a barrage of messages about money, from advertisers targeting commercials specifically toward the children’s market, to your kids witnessing you spending money, writing checks, and using an ATM card. And while schools may teach a little bit about money, it is up to us as parents to teach solid money management principles.
In this two-part series, I’ll share some of the most practical (and fun) ways to teach your child about money based on their age.
Today’s article shares 10 ways to teach your preschooler about money.
Before you begin, keep the following tips in mind:
- keep the lessons short and sweet. As I am sure you know, preschoolers have a short attention span.
- make learning fun as your child will be more likely to get involved and pay attention.
- your main goal with preschool age children is to teach them to become familiar with money such as the different types (coins vs bills), what money is used for, and the basics of where money comes from (it is earned, there is no magic behind the ATM or the swiping of a credit card).
- always take any opportunity that presents itself to teach your child the difference between wants and needs as this plays a huge role in how people manage money.
1. Familiarize Your Child with Money
First you need to familiarize your child with money. This can begin at early age, basically as soon as your child can count.
Start with coins, then once your child has mastered coins, introduce paper money. In a child’s eye, coins are probably more valuable than paper money, but over time they’ll begin to understand the relationship. Start by helping your child learn to differentiate coins by having them participate in sorting activities. Teach them to separate pennies from silver coins. You can also have them sort by size, color and name. As your child progresses, have them sort by value. Keep in mind that for a young child learning the concept that a nickel is more than a penny can be difficult to grasp. Then take it a step further by helping your child count with coins. Since pennies are the most easily understood, have your child practice counting out different amounts of pennies at a time. With older preschoolers who are familiar with coin names and values, you can begin to introduce the concept that five pennies is the same as 1 nickel, and so on.
2. Playing Pretend
Children love playing pretend, and it is great practice for real life. One way to teach the value of money is by playing pretend bank and exchanging money. You be the teller and have your child exchange 10 pennies for 2 nickels and 2 nickels for a dime, and so on. Take it a step further and pretend to operate a store where your child can buy his or her own toys and treats. Of course young children will not be able to make change, but they can easily give you a dime for an apple, or a dollar for a stuffed animal.
3. The Money Memory Game
Further help your child to learn the different types of coins and bills by using index cards and markers to make a game of Money Memory. This is the same concept as the game Memory but it uses money. For example, have your child find the two cards with a picture of a penny on them. Take it a step further, find the card with three pennies then the card that has the corresponding number 3. Play other games that involve money – you can search online for games you can make, or go to a teacher store and see what they have.
4. Money Art
Another fun way for your preschooler to learn about money, more specifically coins, is to do coin rubbings. Place different coins under a piece of paper and teach your child how to use a crayon to rub across the tops of the coins. Kids love watching the pictures appear on the paper!
5. Read Stories About Money
There are plenty of preschool-aged children’s stories that teach money sense. Pick a few books and read to your child. Some of my favorites include: “Arthur’s Pet Business” by Mercer Meyer; “Sheep In A Shop” by Nancy Shaw; “The Berenstain Bears’ Trouble With Money” by Stan and Jan Berenstain; “The Coin Counting Book” by Rozanne Williams; “Paddy’s Pay Day” by Alexandra Day and “My First Job” by Julia Allen.
6. Money Sorting Jars
Gather four plastic jars and on each jar add a picture of a penny, nickel, dime and quarter respectively. Hand your child a large pile of change, and let them sort the coins into the correct jar. Take it a step further and have her count it as she adds it to the jar.
7. Involve Your Child in Everyday Spending Activities
One of the best ways for children to learn about money is by making sure they see you using money in everyday situations such as paying for gas or groceries. Let them see you withdraw money from the ATM, taking the opportunity to explain that this is not a magic money machine. When you go shopping, get your children involved in paying for your purchases. Don’t always pay with plastic, otherwise they won’t learn about the different value of bills and coins. Give him or her a dollar or two to purchase something. If they choose something that is too expensive, explain why it can’t be purchased out of the budget. This is the perfect opportunity to begin teaching the valuable lesson about making choices on how to spend money.
8. Hit a Yard Sale or Thrift Shop as a Learning Opportunity
Yard sales and thrift stores can be a great way to teach about spending money since they are often filled with stuff for kids at very inexpensive prices. Let your child pick out a book or toy, then give him the money to pay for it himself.
9. Age Appropriate Online Games
With today’s technology, you can find plenty of age – appropriate online games for preschool-aged children (4 and 5 year olds) that teach about money. A few of my favorites are: Counting Coins Game, Dollar Bill, Kindergarten IXL and Catch the Money. Doing some online research is sure to find more games.
10. Piggy Bank
Perhaps the most well-known way to teach children about saving and spending, is to begin a piggy bank for your preschooler. Let her add her change to it, and occasionally empty it out and count so she can see that the money is adding up. As she grows older, you can begin to incorporate more lessons into this as I will mention in part two.