Begin their money education early

Raising Money-Smart Preschool Children

by Debra Karplus

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Make Your Kid A Money Genius (Even If You're Not) by Beth Kobliner makes a case for instilling solid financial values in children as young as three years old. She says, "Research states that even preschoolers can understand basic money concepts." She refers to a Cambridge University study demonstrating that many money habits are formed by the time a child is seven years old. So what are some fun activities that a parent or grandparent of a little one can do to assure that the little one grows up to be money smart?

There is a practical side to learning to count.

Your youngster may recognize some numbers and may even be able to count to ten or higher. Take counting to the next level. When you next take your child to the gas station, grocery or discount store, plan on discussing and showing them the prices and weights on common items. Let them help you decide on the smartest buy, such as the bigger box of their favorite breakfast cereal at the lower unit price. Encourage them to assist you in weighing produce or bulk food before putting food into your shopping cart.

Banking and credit cards are all about real money.

Paying using a credit card is the perfect opportunity to explain how credit cards and banks work, even to a very young child. They can learn that you buy many items using a credit card, but that you eventually have to pay for the goods, so you never want to buy more things than you can afford. A visit to your bank or credit union can be a fun and informative field trip for your child; they can learn simple concepts about savings and checking accounts from your banker and maybe even open a savings account that you can help them grow.

Raising Money-Smart Preschool Children

Money does not grow on trees; people have to earn money.

So what do mommy and daddy or grandma and grandpa do all day? They work at an office or maybe have a job where they work from home. In their job, they do helpful things for other people who pay them money for doing those jobs. Grownups put that money into the bank, so they can pay for things like food and treats for their children. A young child can easily process this concept. They may better understand the idea of earning money if they get paid for jobs they can do, such as sorting or folding laundry, sweeping the kitchen floor after they have left crumbs, dusting, or putting forks and spoons into the dishwasher (safe items that go in the front of the bottom rack).

There are important life lessons to learn about immediate gratification.

Would you rather have one of something you like today or two of those same items in the future? Questions and situations like these provide early lessons in immediate gratification. Be creative and come up with your own ideas.

Is your family heading for debt trouble? Many families are and don't even know it. This simple checklist can help you determine if you are and what you can do to avoid it.

What do people do with their money?

The youngest of children can learn the difference between spending, sharing, and saving. They need to develop fundamental ideas of the value of doing a little of each.

Little kids also can learn how to take care of their belongings, such as wiping off dirt from their tricycle or doing a simple repair on a broken toy.

You and your older children, who are probably more creative than you think, can create other fun scenarios to help the little ones build the basics for being financially savvy. There are many fun picture books, fiction and non-fiction, that you can buy in a bookstore or online for little ones, which teach important lessons about money, generosity, and sharing. There are also games to buy that are money-oriented.

Survey Junkie

Preschool children are like little sponges when it comes to learning new concepts, and they love discussing and asking questions. Use simple daily experiences like shopping as an opportunity to learn about money.

Though you love buying things for your child, you can pat yourself on the back if your kids grow up money-smart, can support themselves comfortably, and do not expect a handout or a roof over their heads after they are well into adulthood.

Debra is an occupational therapist, accountant, teacher and freelance writer. She is a writer for Advance for Occupational Therapy Practitioners. She also writes for Grand Magazine, has some items (fiction and non fiction) selling on (kindle), has written several travel articles for the Champaign-Urbana News-Gazette and several articles for and volunteers as a money mentor for the University of Illinois Cooperative Extension money mentoring program. Learn more about her at

Take the Next Step:

  • Get guidelines for when and how you should start giving your child an allowance.
  • It is never too early to start teaching your children the importance of saving. Compare savings and money market account rates and open an account for them today.
  • Don't allow debt to prevent you from providing for your family the way you would like. Start taking the steps to get out of debt today so you can give your family a better tomorrow.
  • It's tough raising kids today! You need every time and money saving idea you can find. That's why you'll want to get our free weekly Dollar Stretcher for Parents newsletter. You'll find great ideas designed just for parents that will help your family 'live better...for less'! Subscribers get a copy of our ebook Little Luxuries: 130 Ways to Live Better...For Less for FREE.

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