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Teaching Your Children About Money

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I remember when I was little, I absolutely LOVED to play dress-up. What's more, I loved to use my mom's clothes. While I was talking with Mom yesterday, we touched on that topic and on a very funny memory, and I thought that you might like to know about it.


One day while I played dress-up, I had decided that I needed to go to the "store", so wearing one of Mom's white tee shirts, a scarf, and my mom's tennis shoes, I grabbed her purse and proceeded to put my play food in a little basket. I ended up dropping the purse, and since it was my mom's, it was fairly full and several things fell out. I started to pick them up and found mom's checkbook.

When I grabbed it, I saw that in the checkbook mom had a register just like the one that she used to teach me to add and subtract, so I asked her what it was for. I knew that she already knew how to add and subtract, so I didn't see why she had one. So she told me that she used it to pay bills. Then I asked the question that all parents seem to dread: Why? "Well", she said, "because we used the services the company offered and we had to pay them for it." Being confused, I asked why again.


Seeing that I wasn't going to let the topic go, mom sat me down at the table and went through her checkbook with me. She showed me what her paycheck was, then she went down the list: Electric Company so that we could turn on the lights, watch TV., and have the air conditioner in the summer; Gas Company so that we could cook our food and heat the house in the winter; House and Car payments, plus insurance; Gas for the car; Doctor bill; etc; etc. I remember getting scared at that point because I didn't know if mom made enough to cover everything. So she showed me her math and explained that not every bill was due to be paid at the same time, so I was less scared.

Then I asked her what I could do to help, which surprised her greatly. So she explained that if I and my brother would turn off lights and the TV when we didn't need them or weren't using them, it would save money. She also explained that to save money was why we only used the AC (a window unit) to cool the living room and bedrooms, and why we wore sweaters in the winter to help us stay warm. Then with a big hug and kiss, she sent me back to my room to finish cleaning the mess I had made while she started to make supper. After I was done and went to help her, I made sure to turn off the light! ;)


So the lessons I learned from my mom?

  • Fake/old unused checks and registers are great toys for kids and can help them learn math and writing skills. Just make sure you cover any addresses or account numbers if using real/old checks.

  • Kids love to learn, which is why they asked the dreaded question: Why? Heaven knows how often I have wanted to pull out my hair and all I've done is baby-sit.

  • Kids learn better when their lessons are applied to their lives. When a child asks why he/she can't have something, explain the whole reason, and don't just say, "Because I said no." At the very least, tell them you will explain it better when you get home then keep your word.

  • Kids love to help. Whether it is planting and growing a garden, or fixing and repainting a piece of furniture, helping is how they learn and develop skills. And they love to learn how things are connected to each other, like how one plant can produce enough fruit that have seeds in them, to make more plants. And how saving seeds to plant next year saves money as well as produces yummy food.

  • Kids are smart, much smarter then many people give them credit for. While some might think it is a bad idea to expose kids to money matters early, as it applies to their household, so long as they are reassured that their needs are being met, they then learn which things are truly "needs" and which are "want-to-haves". Encourage the child to express themselves and their feelings and thoughts while talking about such things.

  • Kids are creative and can come up with some really good ideas to help the household when given the chance and really listened too. I remember asking my mom if we could turn off the AC at night and open windows during the summer when it was cooler out, so we tried it and it worked pretty well.

  • And last but not least: It takes a household and everyone living in it to work together, if anything is to work at all.

By Krystal from Newton, IA

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April 6, 20110 found this helpful

We got our daughter the Berenstain Bears Dollars and Sense book. Probably when she was in pre-K or kindergarten. If I remember correctly, the kids would blow through their allowance in the first day, and never have enough for more than some candy or cheap little toys. So Mama Bear dug out some checkbooks with old information on them (like when you change banks), and showed them how it worked. The parents kept the money, and when the kids wanted some cash, they had to write a check and keep track of the check register. I think the little sister saved up enough money for a doll (but I could be wrong!). Inside the book, it has several blank fake checks for kids to play with.


We're very much into personal finance and teaching our daughter. We have Bank of Daddy. He got her a little money box, and she makes deposits. He showed her where he tracks it on the computer. If she wants some of her money, she has to go to Bank of Daddy and talk to him to get some money out. At the end of each month, she earns interest. TWELVE PERCENT. We showed her one of our "high interest" accounts that has over $20K in in and how little we earn! I don't remember the rate anymore, because they keep lowering it. :-) So we're trying to encourage her to save, but she has access if she wants/needs it.

Thanks for sharing your memory with us -- I enjoyed reading it!

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April 8, 20110 found this helpful

Well written, Krystal.

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April 9, 20110 found this helpful

My mom used to get me to come grocery shopping with her, and only place things in the cart that were on the list. When I got older I used this same method shopping for her, and can remember once why this was so important, I had to only use the money on the check she sent me with, and how embarrassing it was to put something back due to me adding to the grocery list! I still shop this way.

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April 9, 20110 found this helpful

Wonderful memories and a veritable fountain of wisdom! Thanks.

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