Teaching the Value of Money

If you’ve read my, I’m the Mum Who post, you already know that I’m the mum who takes her kids shopping. I bring them with me pretty much wherever I go! As my boys got older I started having issues with them wanting everything they saw in the shops. It was becoming a hassle. I would explain to them before we left the house that I wasn’t buying anything for them. I would remind them while we were shopping. Then I’d go over it again on the ride home. No amount of these reminders was doing the trick. I’d explain how things cost money and Mommy only has so much money to spend, and we need to buy food, etc. They understood what I was saying but, they still continued to ask for things from the shops.

I started explaining the costs of things in measurements they could understand. Such as, this toy costs the same as 15 packs of Match Attax cards. Or, this toy costs the same as 5 toy tractors. They’d be amazed by how expensive things were. It helped them understand that things cost a lot of money. And Mommy doesn’t have money, to spend on extra bits for them every day. But, the asking for things in the shop still continued until one day I decided to try something new.

I let each boy take 10 euros out of their piggy banks. I explained that the 10 euros is for them to spend. They could buy whatever they wanted with it. But, when it was gone, then they couldn’t buy anything else. We weren’t going to take any more money out of their piggy banks. That money is for saving. So, they should think carefully about what they want to buy.

The next trip to town was very interesting! Both boys were delighted with this 10 euro plan. My son who was 4 at the time spent the majority of his money on the first trip to town. He was happy with his purchases and he spent his remaining euros on bits and pieces over our next few shopping trips. At each purchase, I’d explain how much the item cost and how much he’d have left to spend if he made the purchase.  He never changed his mind and bought whatever struck his fancy.

His brother had just turned 7 at the time. He also spent his money quickly up to his last two euros. When he got down to 2 euros he became very careful about purchases. I remember him coming over to me with a pencil sharpener and asked me to buy it for him. I said what I’d been saying every time, ‘you have enough money to buy that, if you want to buy it you can.’ He asked how much he’d have left and I explained that he’d have no money left if he bought it. He thought for a minute then put the sharpener down and said he’d think about it! He really minded his last two euros, and was very selective about what he’d buy. I was so delighted to see the light bulb moment! He understood how money worked!! Hurray!

Since the 10 euro lesson, I’ve encouraged my boys to save for what they want to buy. If they get money, they save some and put some in an envelope which is for them to spend as they see fit. They both saved up for Match Attax books (to hold all their cards, they are soccer mad!). And, they save money to buy cards or other toys. They don’t ask me to buy things in town nearly as much – it still happens on occasion. But they seem to have really understood the value of money now.

Understanding and appreciating the value of money also helps a child to be grateful for what they have. Another great way to teach gratefulness is by example, I wrote a post about that you can read here if you’re interested.

I’d love to hear your comments about teaching kids the value of money 🙂

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