When a six year old opens a birthday card and a five dollar bill falls out of it, they are quite simply the happiest child alive in that point of time. But what makes money so special or is it simply the fact that they got it?
As my children get older they are learning more about what money is and what you do with it. Before I was scared away by the thought of them learning to be irresponsible with their finances later in life, I decided to take control of the situation and educate them on how to manage their money appropriately while they are still young.
Children are creative creatures and with knowing this, I thought it would be fun to come up with ideas that they would enjoy learning about money- without actually realizing they were being educated at all. The first creative idea was a pretend store. Now this isn't something I taught them, but I do interact with them when they play. They came up with the idea simply on their own from their own experiences.
It was interesting to watch as they created their own little signs, departments and price tags. When they began to "shop", I decided to step in and teach them about the money aspect for their "purchases". If an items was ten dollars, I would pretend to hand them five and help them figure out what needed to be done next to complete the purchase. Of all of the financial activities we played, this one seemed to be the one they enjoyed the most.
The next thing I've did with them to help teach them about money, was give them real money and put them into a real shopping situation- I took them to the local Dollar Tree. The dollar tree (or any other retail store with lower numbers for products) is ideal for small children because the low prices are not complicated to figure out.
With their money they then need to figure out how much they can get for how much money they have to spend. I normally help them out by covering the tax, but explain to them about the tax process as well. This is also great to help them express themselves and better understand their decision making skills.
Another way I keep their interest in Finance is by taking them someplace where they are able to purchase something, with what I call the "Dollar limit". By this I mean, the child will have ten dollars, then they are to find an item (or items) that equal up to or under that amount with the ten dollars they have to spend.
I teach them to read the price tags and signs so that they can find themselves what it is they are looking for at that amount. Not only are they having fun with their finances, they are learning about the cost and value of products we purchase as a family. By doing this, they now look at prices instead of simply asking for an item without giving recognition to how much it will actually cost.
*Note: This was written by a Yahoo! contributor. Do you have a personal finance story that you'd like to share? Sign up with the Yahoo! Contributor Network to start publishing your own finance articles.
- Personal Finance - Career & Education