Teaching Children About Money:
Kid's Money Basics

Teaching children about money seems like it should be an easy task. They probably see money every day. Your family uses it to buy things they are familiar with...groceries, gas and clothes.

But it can get complicated quickly.

Teaching kids about money deals with all of those things. The goal is to give them a solid foundation to understand the money basics as well as help them grow into greater money responsibility. The good news is that there are all kinds of ways to do that!

Teaching children about money begins with first figuring out where they are in their money education. This can be based on age (especially if they are younger). Or, if they are a little older, you need to consider what they already know (or don't!). Keeping that in mind, check out the topics below and pick one to get started.

• Counting money: learning how to recognize and count coins
• Basic household chores: getting started, picking the best chores for kids, and tracking with chore charts
• Understanding your child's money personality so you can teach them about money in a way that fits with their personality.
• Basic saving concepts: piggy banks, money jars and the best savings account for kids plus figuring out to how to get them to save money
• Introduction to spending: smart ways to get them started on learning how to spend wisely
• Money games for kids: from board games to making up your own in the grocery store, use games to teach children about money in a fun way

Most of this will happen either in real-life situations (when you go shopping) or by using money games for kids. The goal at this stage is to give a solid foundation. If they can get the basics down here, the next stages can build on these more easily. This is also a good time to introduce the idea of earning money - whether through routine chores or through other ways.

• Expanded allowances: how much to pay as the kids get older based on what they are doing or on the averages in your area
• Teaching kids to be smart spenders
• Money management for kids: Teaching children about money management from saving and spending to investing and donating and showing how all those pieces work together
• Basic economics for kids: Kids can understand the basics of supply and demand. A great way to learn that? A lemonade stand! Start your own lemonade stand, play a lemonade stand game and perfect those lemonade recipes
• Expanded chores: start or expand the chore program to give kids more responsibility (not just more work!) based on their ages. Or consider a chore contract if they have outgrown chore charts.
• Introduction to basic money terms and definitions: Whether it is understanding what a bank is, how savings accounts and bonds work or how to calculate compound interest, kids can get a good foundation on beginning money terms
• How kids can make money: Kids can earn money in a number of ways although they may have to get creative. They can start their own kid business or even become young inventors with a new product or service. Check out this review of a very helpful ebook that has some great ideas on how kids can make money.

These money lessons can cover quite a few kid years. During this time, most of the money that kids get and spend happens with a parent around to guide them. This can be the best time to be teaching children about money and helping them develop solid money habits that they can carry with them as they start to make more of their own decisions. As they move into their tween and teen years, these money habits will become even more important.