Lessons from the Pros

Education Resource

Fun Ways to Prepare Your Children to Handle Money

Young children watch adults take money from their billfold or purse and hand it to someone after a meal at a restaurant or before they leave a store with an item. But that doesn’t mean they understand how you came up with the combination of coins and bills you gave them.

Teaching your children or grandchildren how to handle money doesn’t have to be boring. Here are four fun activities you can do with your child that will not only help them learn the various types of money and denominations, but also strengthen their math and quantity concepts and show them how to handle money without making it an emotional issue.

Little girl holding up some money

Explain the Different Values of Coins and Bills

Start with a penny, then show them how five pennies equal one nickel, two nickels equal one dime and two dimes and a nickel equal one quarter. Keep going and show them how different coins can equal a dollar bill and how five one-dollar bills equals a five-dollar bill, etc. Don’t take anything for granted—it’s likely that your young child will marvel at how that thin dime will buy more than the larger nickel.

Spend Time at Home Comparing Money and Counting It Out

Make the lesson fun instead of tedious by letting your child count the amount of coins you have in your pocket or purse. Grandparents, this could be a fun activity each time you visit your grandchildren. You could even let them take a guess first and then have them count the money to see if they were right. Next, give them a pile of coins and ask for 28 cents. Don’t insist on one combination or another as long as the total is correct, just help your child with the math if they need it. After they get the hang of it, ask for 42 cents in three different coin combinations. Once they understand coins, you can start to include dollar bills and higher denominations. Don’t reward your child for correct responses by letting them keep the money—remember, you’re trying to keep the emotional factor out of handling money. The reward for you and your child should be the time together and the excitement you both feel as your child learns something new.

Teach Your Child What Change Is and How to Make It

Start out with your piles of coins but ask for an amount from your child that they won’t be able to give you. For instance, ask for 53 cents but don’t give them any pennies. Show them how they can give you more than you’re asking for and how you will return the difference. You’ve now introduced the concept of making change!

Access Free Financial EducationNow use different combinations of coins to make three piles that each add up to one dollar. Tell them you want to buy something for 80 cents from their “store” and hand them a one dollar bill. The goal is to use one of the piles to figure out how much change they need to return to you. Instead of making it a subtraction problem, turn it around and make it an addition problem: show them how to give you an 80 cent item and add 20 cents more to equal the dollar you gave them. Now you have introduced the concept of money having a value, instead of just teaching a little math.

Allow Them to Purchase Something For You at a Store

When your child feels comfortable with counting the coins and has a basic understanding of making change, let them make a purchase with your money at a store. Hand them your wallet and direct them only as needed to complete the transaction correctly. Remember to be patient, so they won’t think of handling money as a stressful activity (make sure no one is in line behind you). It’s also important for the purchase to be something for the household or yourself—no toys or treats! Grandparents, this goes for you too; no matter how bad you may want to spoil your grandchildren. Remember, you’re trying to keep emotions out of it, and teach your grandchildren the monetary value of an item.

By taking the time to explain to your child the different types of money, how to count it and how to get something of value for it, you are providing a meaningful and educational experience without making it an emotional issue. It’s a great way to have fun with your child or grandchild using money instead of using money to have fun with your child.


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