If you are part of the millennial generation, have you ever wondered what life would be like without your debit card? Believe it or not, debit cards did not exist up until the mid 1980’s, and didn’t gain popularity until the late 1990’s. Our generation experienced the paradigm shift into the technology ruled world, which is pretty darn cool if you ask me.
However, with our almost cashless society, how do we teach our kids about money and how to properly manage it if they rarely even see it? Elementary school aged children are developmentally incapable of thinking abstractly.
Funny Money
During preschool years, learning is dependent on play. Introduce funny money, or real money if you can spare some for your child to start exploring. You can then begin to interact with your child during play time, on what money is and why we have it. Try setting up a “grocery store” at home and get down on their level and just play! Children at this age thrive on imitating adults and their actions. There are also a multitude of resources these days, which of course include apps and plenty of books.
Bank of Mom and Dad
As your child grows older hopefully they’ll have a decent understanding of physical money, and they will probably want an allowance. Allowance can be a controversial topic among parents. I myself have mixed feelings about it, but I really appreciate the way my parents introduced allowance and managing our money. They decided to give us a conservative allowance but didn’t actually hand over the cold hard cash.
What they did do, was give us each a check register with our name on it. My parents acted as the bank and when we would earn allowance we would write our “deposit” in the check register. When we wanted to buy something with our money, they would buy it, but then “withdraw” it in our registers.
I don’t have kids yet, but I plan to use this method to teach them how to manage money that they can’t physically see. I felt this was a great idea that my parents came up with, and truly believe that it prepared me as a young adult in handling my money. And yes, you can still get check registers from your bank!
How did you learn about money as a kid? How have you taught your children about money, or, how do you plan to teach your future kids?
We teach our kids about money using the allowance system and Mom/Dad bank. If they do their chores they get paid. If they don’t, then no allowance. For really big purchases I’ll offer some kind of money match (i.e. interest) if they save up. It’s really hard for them to make it up to some target amount like $50 or $100 for whatever thing it is they want. So by adding in some kind of incentive like giving them 50 cents for every dollar they save I feel like it encourages the saving.
That’s awesome! I remember my parents doing the matching incentive for my brother and I as well.