how to help kids understand money management

Teaching young children the value of money management can start as early as they can count. As they grow and become more independent you can teach them vital skills they will need for success in life; goal setting, saving and spending money wisely, prioritizing, and understanding needs verses wants, etc. What we spend much of our money on can also show us where our own values lie within. Remember, you are never too old or young to learn money management techniques!

Techniques For Helping Kids Understand Money Management:
Materials Needed: Fake money (you wouldn't want to misplace the real thing), items or services kids wish to buy, calculator (optional), paper and pencil

Setting the Stage: Of course, you can have kids pretend to purchase items from a play grocery store or shop but real life situations add much more dimension. Prices are clearly labeled and the money they will have on hand will cause them to reason through situations and problem solve.
The Procedure: Copy out some fake money and tell kids you will be going to the store to practice using money. Help kids count how much they have and go through a store with them to see what items they would like to buy. Kids may want to make a list and remind them be sure to write out the prices. Now decide based on how much money you actually have to buy those items (calculators come in handy).
Kids are finding out first hand the value of money and how to use it!

Some great extensions to this activity is to have kids brainstorm how to actually earn the money they would need to get the items they want. Perhaps starting to recycle bottles, cut lawns, paint fences, or start a lemonade stand! Making up their own small business is a great activity for anytime of year as well as keeping kids busy!

For older children you can give specific instructions to choose and item they need and one they want. After a while kids learn about bargain shopping and not always choosing a brand name. Sometimes the next best thing to a brand name item IS having extra money in your pocket!

Some great money tips and blogs about money for us big people can be found on inoutcash.com!