As parents, one of the things we desire for our children is that they understand the value of money and how to save for the future.  The trick is to tailor the lessons to the child’s age. Starting kids off as young as possible is one of the keys to raising money-savvy kids. Even pre-schoolers can learn the value of money and saving if you use the right lessons with them.

Here are some tips on how to start teaching your pre-schoolers about money:

  • Teach them about the different coins.
  • Use a see-through piggy bank or a clear jar so they can see their money “growing.”
  • Instead of giving your children an allowance, pay them for chores like making their bed, feeding the dog, or picking up their toys.
  • When you take your child shopping with you, give him/her a small amount of money to spend however they want or to save for the next shopping trip.  Talk about the cost of items.  This can help your child learn that they can’t buy everything they want.
  • Talk about your next family vacation and involve your children in saving for the trip.
    • Have a vacation jar for extra change.
    • Talk about ways to earn money for the trip, such as having a garage sale.
  • When your child asks for a special toy or game, suggest they add that item to their Christmas or birthday wish list or that they save their chore money to purchase it themselves.  This helps them learn delayed gratification. 

Most importantly, if you want your child to learn good money habits, model the behavior. 

For example, if you will need to replace your car in the future, talk to your children about how you are saving for the next car. Even if you think they are too young to absorb these lessons or understand what you are doing, the continued exposure to good money habits and teachings will have a big impact as they age.

It’s never too early to start talking to your kids about money! Use these easy lessons to get your pre-schoolers started off on the right foot and set them up for a more financially responsible future.

Judith Ackland has more than 26 years of experience in accountancy and financial planning, including seventeen years as a CFO of a diverse business. She started Crystal Financial in 2010 to help a wide array of individuals, families, and business owners better understand their finances and how good financial management could help them achieve their goals. Judith has an MA in Professional Accountancy from the University of Nebraska at Lincoln as well as a Certified Public Accountant Certificate and a Certified Financial Planner designation.

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