Help Your Child Make Sense of Money

Young children are curious and observant. They absorb new information through exploration and modeled behaviors. As parents, it can be challenging to remember young children are always picking up on topics that may seem “too advanced” for them to understand.

A perfect example is the concept of money. Although a true understanding doesn’t come until children reach elementary age, early discussions, feelings, and ideas occur in the early years.

Invest in Your Child’s Understanding

• Incorporate money into playful experiences. Children learn best through play. As they engage in open-ended experiences, include an element of money in sensible scenarios.
  
  • For younger children (ages 2 to 4):
    • Set up a dramatic play restaurant and take on the role of a paying customer. Engage by offering money for the food and talking about the different types of money (dollars, quarters, pennies, etc.).
    • Grab your household coin jar (or empty out your purse or wallet). Encourage children to create simple or complex patterns with different types of coins.
    • Support your child in fine motor development by cutting out coupons to take with you to your next grocery store trip.
      
  • For older children (ages 5 to 7):
    • Board games are a great and natural way to talk through money-related concepts. Try options that include a banking system, such as Monopoly Junior.
    • Expand on the coupon idea, shared above. Explain that it’s a special way to save money and help lower the cost of the purchased goods.
    • Host a lemonade stand and let your child take the lead on learning to manage the money. Talk about adding, subtracting, making change, etc. Read our book recommendations below for some added inspiration!
      
• Model positive framing around the topic. Children as young as 2 can associate emotions and feelings with different discussions you have at the dinner table. Although money can be a sensitive topic, remember you have an audience and try to keep conversations positive and light when discussing financials around your children.
  
• Encourage curiosity. As with any topic, if children ask questions about money or money concepts, answer them positively and honestly. Remember, it is okay to not have all the answers. Acknowledge them by saying, “That is a great question! I’m not sure, but I’d love to do some research and find out. Maybe we can investigate it together!”
  

Books That Incorporate Money

• It Began with Lemonade by Gideon Sterer (Listen Here)
• Lemonade in Winter by Emily Jenkins (Listen Here)

Even though money can be a hot topic, it is important to remember young children will be curious and receptive to ideas around money and money concepts. Keeping conversations and interactions playful, positive, and honest will help them develop healthy habits and support future financial success.