Once kids start to count, they’re starting to learn about money already. Here’s what they should be taught about money at each stage in life!
Ages 3 – 6: Saving
You can explain it this way: “Don’t spend it immediately so that you can buy something you really want in the future” and ask them to draw a picture of something that they want. Help them to calculate how much they need to save each week and let them use different envelopes to save for different things.
Ages 5 – 8: Earning
Let them know that they can do jobs in exchange for money. Slowly introduce them to little jobs like cleaning the dishes or cleaning their room for small amounts of money and add their earnings to a jar to show them how earnings collect over time.
Ages 6 – 10: Spending
It’s time to let them choose some things to buy when you take them out, give them a small budget to work with and let them pick whatever they want at the supermarket. Teach them about brands, how they vary in price and let them pay at the cashiers so that they learn how to do it themselves in future.
Ages 7 – 11: Opportunity Cost
Give them $10 and ask them to pick three items that cost $5 each, then ask them to choose two items to buy. Explain that we have to make financial decisions based on the money that we have.
Ages 11 – 13: Budgeting
They should have a considerable amount of savings to afford a birthday present for each family member in the year. Otherwise, you can give them a budget to work with and help them to plan out how much to spend on each family member’s birthday present. Teach them how to choose presents within their budget.
Ages 13 – 15: Investment
Let them know what investments are: something you buy or put money into so that you can get more money in the future. Explain that paying for university education now will help them to earn more money in the future and how each school and course costs differently. Show them the pay ranges for each line of profession so that they can learn how an investment pays later. Be open about your own financial experiences and share with them about your failures too!
Monopoly is a great family game for the kids to learn the concepts of money from while you spend quality bonding time together. A great way to save is for the whole family to contribute to a savings jar together and book a holiday that everyone has been wanting to go on once you’ve saved enough money together!