3-Minute Guru
Monday, April 18, 2011
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Teaching kids to understand money
BY SHERRY THOMAS
Children can grow to understand money and its value if we take the time to explain it.
Children can learn to calculate money and learn the concept of saving it - watching as just a few pennies here and a few dimes there can amount to a substantial cumulative savings.
Here are some tips for teaching about money:
How four quarters = $1
Have the kids practice counting the four quarters and placing them into separate piles. Then, have them count each pile. Gradually work up to five $1 piles and place next to that a $5 bill. Now they have five piles of four quarters, which equals the same as a $5 bill.
Keep a quarter (or dime) jar
Use a big plastic gallon jug and have the kids promise not to touch the money once it has been released into the jar. Note a "counting day" date clearly visible on the jar. Talk about the "counting day" and how much fun it will be to go to the bank, get coin wrappers, pour the money out onto a table or the floor and count it.
After 12-18 months, celebrate "counting day" with pizza or a balloon that says "Counting Day Is Here" or other clever ideas that will make for a happy memory.
Now the fun begins. Watch as their eyes grow big thinking about how much money they saved and more important, where they can spend it. (Be firm with the 80/20 rule - 80 percent goes to savings; 20 percent for spending).
Have children do the tipping
Let them have the honor of doing that good deed for valets and waiters. It makes them feel grown-up and responsible. Teach them to hand the money directly to the wait staff (never leaving it on the table for concern of it not making it to the intended recipient).
Around ages 10-12, teach them how to figure the tip at 15, 18 and 20 percent. They should be able to calculate it in their head.
Counting their change
Starting around age 9, begin teaching them how to count back change. More and more, I see how reliant cashiers and students have become on technology (cash registers and calculators) to do the math for them. But counting back change is essential. How do you know if you received the right amount of change if you haven't been taught how to count it?
Play Monopoly
The classic board game is a great way to teach about money - and they'll learn about real estate, as well.
Play counting games
Use various coins. The person who lines up the most dimes in 30 seconds, into say, five stacks each equaling $1 wins!
Explain the stock market
Beginning at ages 8-10, explain the stock market and how it works. Show them the ticker tape, the symbols and explain how our gas, our food, everything in our lives is based around the value placed on it by the world's stock markets.
Make learning about money fun, but begin teaching it at an early age. This increases the chances of your child developing an early respect for money, what it takes to earn it and how to determine what is reasonable and necessary as opposed to what is wasteful and impulsive.
Sherry Thomas is president of The Palm Beach School of Etiquette and Life Skills. Follow her on Twitter @EtiquetteQueen.
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