by Emily Hechler 
You’d be surprised at how much kids learn just by observing you. Simple tasks like tying your shoe or vacuuming the floor are easier to pick up, while other lessons require more intentional and on-going effort to teach. Teaching kids about money is one of these things.
You might feel nervous about teaching your kids about money, especially if you’re not confident in how you manage your own finances. Maybe you and your partner argue about money and your child wants to avoid the topic. Fortunately, we have fun and effective ways to teach your children about money, helping them build solid financial habits from an early age.
Use a Clear Jar for Saving
When kids are little, if they don’t see it, it doesn’t exist. Littles can easily forget about the money they put in their piggy bank because they can’t see inside of it. Using a clear jar instead makes it easy for kids to keep an eye on their money. It allows them to literally watch their money grow as more is added to the jar and the pile climbs to the top.
The Clear Jar in the Real World
The more money in the car, the more money you have! More money can be used to buy more or expensive items.
Use Play Money
When I was a kid, I loved playing store. Take turns being the cashier and shopper with your child. When they start to understand basic math, you can charge specific prices for the items in your play store and require your kid to give you the correct change. While this seems simple, it’s a harmless way to demonstrate real scenarios.
Play Money in the Real World
Just like with play money, real money must be used to buy products in real life.
Pay with Cash
While using a debit card is often more convenient, try using cash when your child is around. Kids can easily assume that swiping a card means you just get what you want without realizing what happens behind the scenes, like the money being taken from your account or the consequences of overdrawing. Paying with cash gives them a tangible sense of how money works, allowing them to witness “real money” in action and helping them better understand the connection between spending and having enough funds.
Cash in the Real World
While cash isn’t prevalently used, it helps kids visualize exchanging money for an item more clearly than using a debit or credit card
Have Kids Earn Their Allowance
Ultimately, you know what allowance strategy works best for your family. If you can, have your kids do chores around the house in exchange for their allowance. While some parents opt to give their kids an allowance just because, it can be used an opportunity to create a healthy work ethic. When your child receives money as a gift in the future, it can feel much more meaningful because they’ll understand the effort it takes to earn it.
Allowance in the Real World
In the real world, money is earned. Most of the time it isn’t given. Practicing chores for an allowance is a safe and teachable environment to help your child understand this lesson.
Play Monopoly
If you have an hour or so to spare, have a game night with your kids and play Monopoly. In the game, your kids will have to buy their properties and pay rent. It’s a lot of earning and a lot of spending. This game can help show kids the long effects that their decisions about money can make. Fortunately, there are no real-life consequences to losing the game. You just don’t get bragging rights.
Monopoly in the Real World
While understanding the implications of a real monopoly will be a long and deep conversation, teach about rent, mortgages, and taxes instead. Explain to your kids how you pay rent for an apartment or hotel, pay a mortgage on your home, and taxes every year in April to connect these gamified experiences to the real world.
Avoid Impulse Buys
Impulsive shopping parents create impulsive shopping kids. Like I already said, kids learn through observing. Take a list to the store with you so your kids can see that you don’t buy what you don’t need. If your child has their own money with them and they want to buy something at the store, have them wait until their next visit. Chances are, it’s an impulsive decision. (Unless you’ve heard them talking about it frequently at home.) If you come back a few days later and they don’t remember to buy it, then that’s money they just saved. However, if they do buy it, hype up the anticipation and how much fun it can be waiting to make their dream purchase.
Impulse Buys in the Real World
Avoiding impulsive buys isn’t fun. Creating a shopping experience like a scavenger hunt can be! When you visit the store with your kids, make shopping a game by hunting around the store for the items on your list.
Visit Alltru
Next time you visit the credit union, bring your kids along! If you have a jar of coins, let your child see how the Coinstar machine works. It’s a great way to show them how small amounts of money can add up to something more substantial that can be used to buy something nicer. If your child is 7 or younger, you can help them open a CUbby Savings account with just a $1 deposit. Plus, they can get a special prize for deposits over $10 and on their birthday. Kids ages 8 and older can open a TruSpend Checking and Savings account.
Alltru in the Real World
We’re here to meet your family’s banking needs. As an Alltru member, we can help from any of our branches or through digital banking at home.
Money Is Fun!
If you get excited about saving money, chances are your kids will too. Learning about money with hands-on and hands-off methods like these can make a large impact on your kid’s view of money. Being intentional about teaching your kids can allow for great quality time too. Have fun!
