Your Money-savvy Preschooler
In Beth Kobliner’s book, Make your Kid a Money Genius she suggests that solid financial values develop in children as young as 3 years old. According to Kobliner “research states that even preschoolers can understand basic money concepts.” A study at Cambridge University indicates that money habits form by the time a child turns 7. So what are some fun activities that you do to facilitate raising a money-savvy kid?
Your youngster may know some numbers and may even be able to count to ten or higher and can recognize some numbers. Step it up a notch; on the next trip to the gas station, grocery or discount store, discuss and show them the prices and weights on favorite foods and let them help you decide which is the smartest buy, such as the bigger box of breakfast cereal at the lower unit price or the smaller box. Ask them to help you weigh produce or bulk food before putting food into your shopping cart.
When paying with a credit card, explain how credit cards and banks function. A preschool child 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. Skip the drive-up window and go inside your bank or credit union. You little one can learn simple concepts about savings and checking accounts from your banker. While there, open a savings account that you can help them grow.
So what do mommy and daddy do all day? They go to work or maybe have a job they perform at their computer from home, doing useful tasks for people who pay. Grownups then put that money into the bank to pay for things such as food or visit to the zoo. Preschoolers can process this concept. Also, they can better understand the idea of earning money if they get paid for chores they can do such as sorting or folding laundry.
Would you rather have one of something you like today, or two of those same items sometime in the future? Scenarios such as these provide early lessons in immediate gratification.
Very young kids can differentiate between spending, sharing and saving and can develop basic ideas about balancing these.
Kids also can learn to care for their stuff such as wiping mud from their tricycle or cleaning or doing a simple repair on a broken toy.
You and your older children can create other fun ideas for helping preschoolers develop basics for being financially savvy. There are many fun picture books to buy or at the library that teach money lessons.
Preschool children are like little sponges when it comes to learning new concepts and love discussing and asking questions. Use ordinary experiences such as 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, and can support themselves comfortably and not expect a handout or a roof over their heads after they are well into adulthood.