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Feb 28

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How to Teach Kids about Money ~ Step 2

how to teach kids about money

How to Teach Kids about Money.

 

In case you’re just hopping on board, make sure to check out the first two posts in this series! You can read How to Teach Kids about Money ~ Getting Started and How to Teach Kids about Money ~ Part 1 before continuing below! Thanks for joining me!

 

How to Teach Kids about Money: the Basics.

 

Depending on the age and knowledge of your kids, you’ll want to start with what money is and the amounts each coin or dollar represents. If your children are very young, a basic explanation that you earn money for a job well-done and then use the money to purchase needed items will suffice. If your kids are older and already have a basic grasp of money, a history lesson might be fun to share with them how money has been used throughout history. Looking at an old coin collection might also be interesting to show them. With Jorryn if I can show him something interesting right off the bat, he’ll be much more likely to be interested in the rest of my point! For young kids, play money can be great to work with since it’s not dirty! I used to work in a bank, and let me tell you: money is GROSS! So, I think it would be a good idea for them to see real money, but for teaching them denominations, etc. I think play money would be ideal. Another great tool for younger kids would be a chart to re-enforce what you’ve discussed. I really like this money placemat or this money chart which will help keep the lesson in their minds without you trying to drill it into them!

Once you have worked on denominations, you’ll want to touch on what these terms mean. Again, depending on your child’s age your detail will vary!

  • Income: money earned for goods or services. (employment, job, paycheck)
  • Expense: money spent on goods or services.  (outgoing, bills, debt)
  • Budget: a list of income and expenses.
  • Debt: owing money to someone else, usually for a charge.
  • Interest: a rate (amount) charged or paid for the use of money. (It could be money earned on money in a savings account or it could be money spent on a debt such as a credit card or mortgage.)
  • Inflation: the increase of prices over time.
  • Discount: a reduced price.
  • Savings: money that is not spent, but kept some place safe such as a bank or piggy bank.
  • Charity/Tithe: a portion of income that is donated to a charity or church. Usually 10% of the income.
  • Bonus: extra money that can be earned for accomplishing additional tasks.

 

Have you discussed money with your kids yet? What kind of questions did they have? How much detail did you go into with them?

 

Join me again tomorrow for the next post in How to Teach Kids about Money!

 

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