Ages 0 to 6: START EARLY
Money experts agree that kids as young as age 2, quite often understand more about money than we give them credit. As one Money Coach once stated: The best age to start giving a child an allowance is when they are old enough not to put it in their mouth.
The key at this age and stage is to get kids comfortable with handling money. The idea is to increase their familiarity with the concept and application of money and to slowly introduce the bigger concepts as they grow.
How to do this:
- If you have young children, aged 2 to 8, an easy way to start introducing the concept of money is to sit and sort coins with them. Talk to them about each type of coin, what it’s worth and how different coins have different values. As your children age, consider introducing math to this activity: Asking them to sort the coins before asking them to count out different amounts — “show me $2.10.”
- Talk about money. Link everyday activities, such as grocery shopping, to money. Pay cash and let your child help count out the amount owed to the cashier. If paying by credit or debit card, talk to your child about the link between the amount owed, your method of payment and the money in your bank account. Don’t expect a child to become engrossed in these conversations. The aim isn’t to excite or entertain but to help your child become familiar with the concept of earning and spending.
- Introduce the concept of trade-offs (because money is not just about paper and coins or a bank balance). A good way to teach this is to offer your child a cookie or carrot now or ask them to wait 10 minutes when they can get two cookies or carrots. The lesson: Delaying their gratification can come with greater rewards. That’s the whole point of saving.