Today, Pam Caves asked me to drop by and share some tips for helping kids learn about money. Thanks, Pam!
There are many ways to get your kids started on the path to learning good savings habits, but none is as effective and simple as starting them out with a piggy bank or even just a jar. Kids can begin to grasp basic money concepts almost as soon as they can walk and it’s never too early to let them start accumulating some coins.
Young kids can add to their savings in many ways: from their chores, from gifts from family, and even from scrounging in couch cushions. There is no such thing as “not enough money to bother with”. Help kids understand that every penny counts--literally. Allow them to pick up pennies on the sidewalk and add them to their savings. That way, they learn that all money is to be respected and cared for. People who don’t learn to care for the pennies when they’re young grow into adults who waste dollar bills...and ten dollar bills.
Let kids count their stash as often as they like. Schools often teach coin recognition in the second and third grade when they start to teach the concept of fractions but there’s no need to wait that long. Kids can learn that four quarters make a dollar and that two dimes and a nickel are the same thing as a quarter before they start kindergarten.
As soon as kids are old enough to count their money, tape a piece of paper on the outside of the jar and let them update their balance every time they count. This gives them a second way to see that their money is growing. There are (expensive) piggy banks on the market today that use coin recognition technology and keep a running balance but nothing beats a canning jar, a pencil and paper, and some basic math skills.
To see more tips for raising money smart kids, check out other stops on my March blog tour at http://www.piggybanks2paychecks.com/p/piggy-banks-to-paychecks-2012-blog-tour.html