When should we start teaching preschoolers about money and how we should incorporate a positive habit of saving money? For families managing money is one of the most important aspects of life, especially with prices of daily essentials on the rise. Spending at right time and for right purpose is important thing to incorporate in your child. Preschool is a crucial age and great time to discuss money with your child so its value is permanently etched in their minds.
Preschool is an exciting time for children who are willing to accept and learn new thoughts generally with a smile (obviously not always). When I was young, I have seen my parents struggling regularly to maintain household budget and this is how I understood the difference between “want” and “need”.
With working parents and children being pampered on a daily basis, parents tend to leave this concept behind which later results in significant debt or inability to manage finances.
When should we introduce value of money?
Between the age of 2 to 3, children are able to recognize numbers and differentiate between different coins. This is a great time for children to learn about money and its various denominations. I used to take my son grocery shopping and give him to pay cash / coins for his candies. This allowed him to understand that there are no free lunches and everything needs money. Many children are able to read or are learning to read numbers. Learn more about when to introduce reading to kids
At this age children are more willing to learn and help around the house, this is a great time for parents to focus and introduce positive habits like saving money and making good use of it.
Making a child understand value of money
Usually most children get attracted to the various sounds and colours around them and most organizations play this marketing gimmick extremely well to sell their products. Parents give-in to the demands of stubborn and crying children which leads to another demand and a vicious crying cycle is created. This way you are contributing his irresponsible attitude towards money. Most children carry a sulking attitude if demands are not met but always remember that there are ways to handle such behaviour
Here are few tips that could help teaching preschoolers about money.
Fixed allowance – Fix an allowance for a preschooler. This would help your child learn if he needs to buy something he/she cannot afford, he/she will have to wait and save for it. He can now learn to spend money and prioritize what they need. This also allows them to understand difference between what they needs vs what they want. Remember this is to make them learn and allow them to think more about how to save and manage needs
Practice what you preach
Children learn from you. If they see you working hard to earn pennies and saving them, than this is what they will learn. Make sure you are practicing and handling your finances well. You should display yourself as a sensible person investing in things based on priority and need and definitely not over the top spending.
This way your child will learn to value money and will learn to manage needs.
Allow them to shop with you
Taking your child with you to shop is an exciting experience for him/her and also allows to understand that we can’t afford everything. When I take my son for shopping, I usually discuss with him why am I looking to buy this versus an alternative. This allows him to think that we should look at alternatives which are available and decide before buying.
Let him earn money
For a preschooler rewards is a great way to push your child incorporate a good habits. We have an environment for our little one in which he needs to earn his wishes. For example, if he finishes his meal within 30 minutes than extra 15 minutes tablet time on Sunday.
We recently decided to take it to next level by allocating some important work to our little one and earning some pennies for it. So, now he responsible for keeping his shoes and organize his toy chest. If he does it, then he gets extra pennies for that week. This not only has incorporates discipline but he gets to earn his pennies.
Money related fun activities
- DIY coin making – Make your own coins at home to help them understand and differentiate coins and their values
- DIY piggy bank – Allow them to be creative and make their own bank. For growing children, let them calculate interest if they are able to save certain amount by end of 6 months.
- Coin counting – we all collect change that could come handy. Let them count coins. This could help develop interest and who knows you might be raising Numismatics (coin collector). This would be helpful while learning mathematics
I am sure there are lot more activities and techniques that parents use but teaching preschoolers about money is an important task. One should follow techniques but don’t stress much if you are unable to implement them. Love and effort always comes around and the amount of personal attention a parent can give to their child cannot be substituted by anything in the world..
Bio – Pooja Malkani Sharma is mommy blogger and commodity expert running two blogs Colossalumbrella and Generatebucks.com. Colossalumbrella focuses more on parenting and family fun while Generatebucks.com is a commodity focus blog that covers metals and energy counters.