Isobel Mary Champion
How to teach your child the value of money! Earning, saving, and spending!
Updated: Mar 13, 2021
Teaching your child the value and purpose of money these days is no easy task. With the majority of transactions taking place digitally or with the tap of a card, the way children see and observe the use of money is becoming more and more abstract! Most of us don't receive paper bank statements any more, hardly ever use cash, and often make most of our purchases online! How can children grasp onto the importance of something that doesn't even exist in a physical form much of the time? And how to explain the mysterious numbers and symbols that this invisible thing is measured in? Yes, children will learn about coins and counting at school, but you will be teaching your child valuable life skills if you can instil in them a good basic understanding of money and it's purpose before then (you will also be engaging them in mathematics, problem solving, and fine motor skills!
Top tip: Try setting up a "shop" with a few sweet treats or tasty snacks on a table, and give each one a price tag. Give your child a handful of coins - if they can put together the right amount of coins, they get to eat the treat! Try the same with a selection of DVDs - if they get the price right they get to watch the movie (think Blockbuster Video!)! Next time play "shop" - use baked beans tins, fruit, packets of pasta, jars of jam - and give each one a price. Take turns being the shopkeeper and the customer!
Counting coins aside, the value of money and its role in life are harder to teach. I have come up with six key ways in which I believe that parents can teach their child the value of money, what it is for, and how we can earn it! Originally written as part of a press release for Compare the Market, I share my tips with you here:
1. Teach your how to child earn money!
From an early age you can give your child small amounts of money (coins are ideal) for pocket money, for doing chores around the house, and even from the Tooth Fairy! This will teach your child how money is earned - in exchange for a job well done, or in exchange for goods (e.g. a tooth!).
2. Teach your child how to save money!
In the early years a piggy bank is perfect for your child to keep their earnings in (help them to practice identifying the different coins, and how to count them - count the different coins in 1s, 2s, 5s, 10s, 20s, and 50s!), and for older children a bank account in their name can hold their savings , and they can watch them grow and accumulate interest (let them log in to their online bank account, and actually see their money grow!).
3. Let your child spend their hard-earned pennies!
From a young age the best way to teach your child the value of money (and its purpose!), is to let them spend some of the coins they have earned by doing their chores, or saving their Tooth Fairy or birthday money! Take them to your local shop, and let them choose what to spend their money on - sweets, stickers, or a magazine or small toy. For older children a debit card can hold the same power (and letting them access your Amazon account!) - but coins and notes and physical purchases are the best way to start.
4. Take your child to the bank!
When Covid-19 restrictions allow (and you feel comfortable venturing down the hight-street with your child again!), take your child with you to the local branch of your bank, and let them see the physical location of their bank account. Let them see how money comes out of an ATM machine, and how you can pay money in. Online banking has made life easier for all of us, but it also makes teaching children about money a lot more difficult! Let them see the money and banking in their physical forms!
5. Be honest with your child about finances!
Children often have a very limited grasp on the idea that their parents work in order to earn money, and that it is this money that goes to pay for their home, the things in it, and most of the things they enjoy. Be honest with your child about these things, but let them take the lead on this. If they ask a question, answer it honestly in words that they will understand - don't let it become an emotional issue, just stick to the facts, and keep things simple! If you can't afford the new bike they want, or they toy they have seen on the TV, explain this to them. They might have to wait, and they might have to save up some of their own money, but this will only make the purchase seem more special once it arrives (and if you really can't afford it, don't worry, they will quickly forget about it!)!
6. Model generosity and philanthropy!
Model the characteristics that you would like to see in your child by donating money to a charity of your (or their!) choice, by giving donations to local worthy causes, and by helping those in need. Spending money on gifts for others, giving old toys to second hand shops, and sharing what you have with those less fortunate are also wonderful ways to encourage your child to appreciate their possessions, and to share what they have with others who may have less.
Got any more useful tips on how to teach your child about money? Let me know and I will share them here!
The month of February is going to be all about weaning for me, I will be running a free online Weaning SOS surgery all this month, and you can read Nutritionist Emma West and my own top tips for starting weaning in our recent blog post together. For more of my thoughts on eating, food refusal and mealtimes, check out my recent posts Is Your Child a Fussy Eater? and Dinner Time Drama!
My Spring Newsletter will be coming soon, full of lots of positive, holistic, and sustainable ways to enjoy the joys of Spring. While you are here, why not read my interview about Step Parenting with the Step-In-Mum Veronika Durham, my Better Sleep and Bedtimes post with guest Sleep Consultant Alexandra Collingbourne, and check out my other posts with the lovely Emma West, about Pre-and Post-Natal Exercise, and Pre- and Post-Natal Nutrition! Check out my other posts for more info and advice on screen time, buying pre-loved children's clothing, declutteringbefore your new baby, and thinking about whether or not your family could foster a child. Visit the rest of my website to find out more about my parenting coaching services, child development, child behaviour, and positive parenting!
Get in touch for more information on any of the topics mentioned here or elsewhere on my site, I would love to hear from you!