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Tips on little kids finance

It’s so fun teaching little kids finance – they are so responsive and naturally inquisitive, and although they don’t understand all the nuances of modern finance, you’ll be surprised what they can learn just through watching you and your money habits!

You can start talking about money with Pre-school aged children and playing simple money games. While they may be too young for an allowance, you can still introduce the concept of effort and reward by giving sweets and treats for helping around the house or for good behaviour.

Try the following kids finance activities with your pre-school aged children:
  • Colour in pictures of coins and notes, or rub a pencil over a sheet of paper on top of a coin. Look at all the graphics and images on coins and notes, and maybe even find some international currency to show them.
  • Show them real money and how it adds up. Talk about the cost of items when you’re shopping – even if you just talk out aloud while making your own decisions.
  • Start talking about money, get them to hold money and pay for small items in a shop. It’s also fun to let them add some coins to a charity box or buy a drink from a vending machine.
  • Play shops by setting up a store and cash register and buy items with play money.
  • You may want to give them a small allowance or reward – maybe only $1 or a lollipop per week initially - for helping around the house. Help your child save their money and buy them a piggy bank.
Once your child goes to school, it is time to formally introduce pocket money (also referred to as an allowance) and agree a saving and spending plan with them.
  • Discuss pocket money with them – what it’s for, what you expect in return for giving them an allowance and how you expect them to spend it.
  • Typically, pay $1 per grade at school or age per week, depending on YOUR budget.
  • Set up a piggy bank system with 4 piggy banks – one for money they can spend during the week, one for short term goals, one for long term goals and one for gifts and charity. Agree how much of their money goes in each piggy bank each week. For example 50% to spend this week, 20% for short term goals, 20% for long term goals and 10% for gifts and charity.
  • Continue to talk about budgets, costs of items and money when ever you can. It’s important that children see that money and finance is just another normal part of life that they need to learn to manage.
  • Teach your child the important of charity.
  • Set up a bank account as their long term goal piggy bank starts to grow. Explain how compound interest works and why it’s important to start saving when you’re young.
It’s amazing how much little kids will learn about little kids finance – remember though, that money education is an on-going activity. Constantly talk to them about money and finance and how they can positively make a difference to their financial future by learning correct money management – and show them how they can make their money grow for their future.

Check out this fun site full of Kids finance games - kids learn best when having fun!
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How
                                    to Raise Happy, Healthy, Self-Confident Childr

We are not certified financial planners or advisors. The information in this website is general information only. Always consult a licensed financial planner before making any finance or investment decision.


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