The best way to teach kids financial literacy is in the context of their everyday lives. Here are several examples of how to capitalize (!) on everyday experiences:
Money Moment 1: Young children love putting coins into vending machines. The next time your youngster asks for money for soda or bag of chips (and you agree), pull out a variety of coins and walk him through picking out the correct coins: “We need sixty-five cents. Can you find two quarters…they’re the biggest ones. They are twenty-five cents each. That’s fifty cents together. Now we’re going to need a dime. That’s the smallest one and it’s worth ten cents. Finally, we need a nickel. It’s the one with the smooth edges. This one is worth five cents. Now we have enough for the chips.”
Not only are you covering coins and their values, but you’re touching a lot of math concepts, biggest…smallest…finally, as well. But don’t expect him to get it all the first, second, or third time; it is through repeated exposure in a non-threatening environment where the brain grows best.
Money Moment 2: Grocery shopping with a preschooler can sometimes try a parents’ patience. So the next time you find yourself in the cereal isle with your young one, get her involved in the process: “It would be nice to be able to buy all the cereal we want, but we only have a certain amount of money to spend on groceries. Can you help me choose the cereal we will buy this week?”
Give her a choice between two or three different cereals and let her put it into the cart. Not only does this keep her busy, but you’ll be showing her that her opinions are valued which is great confidencebuilding in kids. Repeat this scenario in other aisles, as well. And although it will add five minutes to your shopping experience, it’s well worth the extra time to begin teaching needs vs wants, budgeting, and making choices.
Money Moment 3: To piggyback on the last money moment, have your child choose one item from the cart and have him pay for it separately. He can hand the money to the cashier then collect the change. Tell him that he gets to keep the change in his money jar* at home. Having him physically go through this “exercise” helps him understand that we exchange money for goods which is often difficult to teach young kids who simply see us swipe a card. In addition, collecting the change in his money jar not only teaches him to save some of his money but it also gives you opportunities to have him sort the coins into piles while you discuss the values.
*Activity: Money Jar
- mason jar
- hot glue gun /glue sticks (or use only sticky-back craft foam)
- pom poms
- permanent markers
- ribbon or sticky-back craft foam
- any other fun stuff to place on jar
Using a mason jar for this activity is important because it allows your child to watch her money “grow”. In addition, the lids are perfect for customizing a slot where the coins/bills will go through.
1. Remove the metal circular lid and cut a cardboard circle the same size. Throw away the circular metal lid.
2. Cut a slot in the cardboard large enough for a quarter to easily fit through.
3. Have your child decorate their jar. You can squeeze the glue from the glue gun onto the jar for
her. Or, if you prefer, there are plenty of non glue-gun materials, such as stickers and sticky-back craft foam, you can use to decorate.
4. Glue the ribbon, or use sticky back foam, around the rim of the lid.
5. Screw the lid on tight and begin dropping in coins!
by Karyn Hodgens, Kids’ Personal Finance Educator
Karyn Hodgens is co-founder of Kidnexions, a kids’ savings software company. She has a BA in Child Development, a Masters of Arts in Education with a Specialization in Elementary Mathematics, and a multiple subjects teaching credential. Her passion is designing real-world lessons that resonate with kids and their interests. Karyn is currently teaching kids how to prepare for their financial future in addition to writing about kids and money issues. www.kidnexions.com