If your children are anything like ours, more than once you’ve found them rearranging the cards in your wallet for a fun game of “Explore Adulthood” and “Make Mommy Lose It at the Grocery Store Checkout.”

All that wallet curiosity may have them thinking about carrying around money of their own, especially as they grow out of the rearranging the cards stage and into the “Mom, can I have five bucks” stage.

However, before you add a children’s size wallet to your Amazon cart, let’s make sure your child is up on their financial literacy so they know that this isn’t Monopoly money they are carrying around. It’s real dollars that they can spend, save, or very easily lose and that money has value.

If you don’t know where to start with teaching your children about money, we’re here to help.

1. Start with the basics

Children aren’t born knowing about what money is, you need to teach that stuff! Dr. Seuss has a great book on the history of money and how we use it. Check out One Cent, Two Cents, Old Cents, New Cents at the library or find it online.

To get more into the details of specific types of currency, create a game where children match up pennies, nickels, dimes, and quarters with the appropriate value written on construction paper. Then by creating groups of coins, show your children how many of one coin equals another. You can find more fun math games here.

2. Create a saving plan

Once your child understands the different values of money, help them learn how to save money to buy things they want. For younger children, you can help them to start learning about savings with a clear jar that lets them see how much money they have. Classic piggy banks are great, but the clear jar is especially helpful for the visual learner.

As your children become teens, help them trade out the jar for a bank savings account. By that point your child may be working part time, or getting very close to that first job, so a savings account will be an important next step and will set them up for success.

3. Explain what things cost

You’ve taught your children about what money is, why we have it, and how to save it. Now they are going to be itching to spend it!

When you are out at the store together, talk to your children about how much certain items cost. We need cereal to eat for breakfast and that box of cereal is $3.00 so we will add it to our cart. We don’t need that giant beach ball which costs $5.00, it’s not within our grocery budget of $100, so we will not be buying that today.

We get upset with our children when they get a case of the gimme gimmes, but if they don’t know how much things cost it’s easy to get carried away with wanting more and more. Talk it out so they will learn and then if they want to spend money from their savings jar at home, they can bring it to the store next time and buy that beach ball. Make sure they are doing the counting of bills and coins to get that math practice in too!

4. Show them how to earn money, not simply expect it

Some of those savings in the jar at home are from Great Aunt Mildred who graciously sends $10 in your children’s birthday cards. (Those were the days right?) However, children also need to learn that money doesn’t grow on trees, or in birthday cards, and it should be earned.

Instead of doling out allowances, set expectations for your children to help out around the house as a part of being a member of the family. For bigger chores, allow them to earn money for their work. Setting the table every day may be an expectation, but vacuuming the whole house could earn them a few dollars. Be clear about what is expected and what’s worth a paycheck and then be consistent so you can have a discussion around how much they need to work to earn something they have been saving for.

It’s also never too early to teach children about entrepreneurship. If they want to set up a lemonade stand, they should use the savings from their jar to buy the supplies and then set up shop. You’re already moving from addition and subtraction into balance sheets, but it’s not that complicated! Your tweens and teens can also mow lawns for neighbors, shovel driveways, or babysit to earn money for things they want and save for college. When your children have a goal in mind, use those math skills to help them figure out a savings and work plan to get there.

Okay, now you can go buy that wallet!

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