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Teaching Kids What to Do with Money


Money is part of our daily lives and your children see you use it all the time. They tag along when buying groceries, or you buy them a toy, or hear you talk about paying bills. Children witness you using money regularly, but have you taken time to teach them what money is and how to properly use it? Do they understand you have a budget, that you save money every month, or how much money things cost? Here’s some advice to get start with teaching kids about money.

What is Money?

small girl taking moneyThe first concept to teach your child is what money is. They see you handing over cash or swiping a card, and then you get the thing you wanted. The abstract idea of currency might not make a lot of sense, depending on their age.

A good way to teach what money is and why we use it, is to give them a few dollars in exchange for a job they did for you. You give them the dollar and tell them that it represents the effort and time they spent doing the job. Then, they can trade the money for something of equal value in the world. This helps teach that their work can help them get what they need and want.

The Value of Saving a Dollar

three small children on stairsOnce your child understands what money is, the next concept to teach is how to save money. Saving money is an essential life skill that everyone needs and should practice. But how do you teach a child who just got five dollars that they should put it in a bank account or their piggy bank rather than buying a small toy or treats at the store?

One way is to help them make a financial goal they want to reach. For example, is there an expensive toy or game your child wants, but can’t afford? Tell them to start saving money to buy that toy, and then once they reach it, they buy it all with their own money! This teaches them how to save money and how to reach a goal they set.

If you are looking for a secure and convenient place for your child to keep their money away from temptation, Pioneer has a Super Star Youth Savings account. They can earn interest on their money while keeping it safe.

How to Spend Money

Equally important to saving money is teaching kids how to spend it. It might seem like a simple concept to teach; find out how much something costs and give them the right amount of cash, but shopping intelligently is a developed skill.

If your child is looking to buy a certain toy as their goal, don’t just head to the nearest store to buy it. Work with them to try and get the best deal they can. Show them the steps of researching and shopping around to save money on their purchase. That could include waiting for a sale, comparison shopping, or buying something similar for a lower price.

You should also teach kids the different ways to spend money. They are likely familiar with cash, but they need to know how debit and credit cards work, and even a little bit about debt and loans wouldn’t hurt either.

Use Money to Help Others

little girl in witch hat paintingMoney is great for taking care of our own needs, but children should also learn how valuable it can be in helping others, and how to give it the right way. Charity should not be ignored when talking about money. There needs to be a balance taught between taking care of yourself and helping others.

When teaching kids about helping others, there are three things they can give: their money, supplies, and time. Knowing when to give each thing can ensure their efforts go to the right people and actually help. For example, they don’t want to donate their money to an organization that claims to help others, but then most of the money goes to support a CEO. Before giving money, do research on the organization to make sure they are reputable and are actually affecting real change.

Teach your children how to learn ways to best help others. If you want to donate to a local homeless shelter or food kitchen, ask what they need before buying supplies at the store. Often, you’ll be surprised what items are actually needed versus what they have too much of. Don’t just assume you know what each person you help needs, but instead ask what they need.

Finally, partner with reputable non-profit and volunteer organizations in your community. Many of these have low funding or support, but provide very important services. They could use your money, supplies, and time to achieve their mission.

During the months of October and November, Pioneer is offering the chance for our youth to get involved with helping others. With our Holiday Save and Share event, if your child deposits ten dollars into their Super Star Youth Savings account, we will match that deposit and also donate an additional ten dollars to one of three chosen organizations. The great part? Your child gets to pick where their money goes! The three organizations are:

  • Camp Rainbow Gold
  • Idaho Battle of the Books
  • Special Olympics of Idaho

Open a Youth Savings Account

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Super Star Youth Savings Account


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