FUN WITH FINANCES: TEACH KIDS MONEY MANAGEMENT SKILLS WITH THESE 5 ACTIVITIES Financial literacy is slipping by the wayside. Schools don’t teach it and because of this, many parents also don’t have the know-how to teach these important skills to their children, resulting in another generation that isn’t fully empowered to flourish. As parents, we want our children to have every opportunity for success. Keeping this in mind, how can parents go about teaching their kids money management skills? Here are 5 great activities that teach children, across age groups, how to work with money wisely. 1. Pay pretend shop This activity is great fun and it’s an ideal method to convey the value of money and the process of exchanging it for goods, especially to young children who haven’t started primary school yet. Choose a number of items from around the home (toys are usually popular) as the “for sale” items. Give each item a numerical value. Using paper, create money that matches the numerical values of the items for sale. At this age, adding and subtracting might be too complex, keep it simple and aim to teach the children about the process of buying. Take turns to be the buyer and the seller. 20
2. Provide a weekly/monthly allowance and give the kids their own “expenses” Children who get a regular allowance are better equipped to learn to manage their money. Whether they want to save up to buy an expensive toy or learn how to budget, knowing how much money they will get each week or month will help them to plan how they will spend their money. Teach them to ensure they always manage to keep some of their money aside as savings, and that they should only buy something if they will have enough money and still have some leftover.
3. Assign chores and give each chore a financial value Washing cars is a common chore that kids do to try and earn some pocket money. Parents can build on this by setting out a number of chores and attaching value to each chore. Children can choose the chores they’d like to do, and they can get paid according to the value of the chores they have chosen. This teaches children that money represents effort and time, it’s not freely available. It also teaches children how much effort goes into acquiring the things they want. Rather than viewing a new toy car as costing $20, they can view it as 4 car washes at $5 a pop.
