I am a firm believer in teaching preschoolers about money. Even before they fully grasp the concept of money’s worth, I think it’s important to be laying the foundation of how money works.
Because of this, I’ve given my children chores to do that earn money, since they were probably 2 and 3 years old. Often, I will allow them to negotiate their pay, based on the job I want them to do. (We have many chores that are just part of being a part of the family, but I feel that paid jobs are important too).
The kids (Miss Magoo and Little Man) have both had piggy banks for a while, but I recently went to the dollar store and purchased two more piggy banks for each of them, so that each child had three banks. I labeled each bank- one is giving, one is spending, and one is saving. Or you could easily use these cute Coin Bank Mason Jar Caps and turn some mason jars into the three banks. Or if you want a really cool compartment bank, check out this Moonjar Classic Moneybox.
I know many people use the concepts of saving 10%, giving 10%, and using the other 80% for spending, but that seemed a bit complex for my little ones. So instead, every time they are paid to do a job, I give them 3 coins- one for each bank.
My kids love going to the bank, so I told them that if they saved enough money in their saving bank, they could open a bank account and use it to buy something big. We talked about large purchases for little kids, like bikes, princess dresses and more. I even joked that if they saved really hard, they could pay cash for their first house!
The concept of the spending bank was pretty easy for the kids to understand. Any money in that bank is theirs to spend however they choose (though Mom and Dad still do have veto power).
Finally, we talked about the giving bank. I told them the the money we put into the giving bank would be to bless other people. Then we talked about many ways we could use that money to bless others.
Ideas for giving:
- Sponsor a child through an organization such as Compassion International.
- Find an organization that aligns with your child’s interests and give to it
- Buy a chicken or cow from World Hunger
- Donate to your local food bank
At least once a week, they will come to me and ask how they can earn money. I come up with a job and we negotiate a fair wage for that job. If they do the job to their best ability, and with a cheerful heart, they are given money to put into their banks. So far, I feel like they are really learning that hard work and a good attitude is rewarded.
Paying them for their work also helps when they start to get the gimmies. If they ask for something when we’re out shopping, my answer is simply, “Did you bring your spending money?” or, “Oh, you don’t have enough money to buy that yet– maybe in another month.” I’m not the bad guy for not buying them every thing they desire, but they’re also learning that their hard work earns them the things they want in life.
How do you teach your kids about money? What things have worked for you, and what things haven’t?
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