How to Teach Toddlers the Importance of Money

Teaching your child about money as early as possible helps build the foundation for future money-making choices. Toddlers have a limited concept of money, so parents should take it slow by teaching the basics. Encourage your child to spend and save her own money that she earns from chores. By earning and saving money, your child learns the value of a dollar and has the opportunity to make decisions about how to spend her own money wisely.

Things You'll Need

  • Piggy bank
  • Homemade coupons

Instructions

    • 1

      Choose your language carefully when talking about money. In a CBS Los Angeles article, creator of the Enlightened Kid program, Christy Whitman, explains that parents can pass on their negative feelings about money through their language and actions. Whitman suggests choosing phrases such as, ̶0;I am choosing not to purchase that,̶1; instead of, ̶0;We can̵7;t afford that.̶1; She also suggests telling kids that money is attracted by doing things of value.

    • 2

      Provide your toddler with an allowance for age-appropriate chores, such as picking up toys or feeding the family pet. This will teach her that she can earn something of value for hard work.

    • 3

      Pick out a piggy bank with your toddler. Encourage your child to put any money she earns in her piggy bank until she has enough money to buy something she wants, such as a new toy.

    • 4

      Teach your toddler the concept of earning something of value. An article on Bargaineering recommends developing a coupon system to reward good behavior. When your child picks up her toys, helps clean up after dinner or does her assigned chores, present her with a coupon. Create a chart with pictures that lets your toddler know how many coupons each reward costs. Your child can save up her coupons for activities such as going out for ice cream, watching her favorite movie or getting a new toy.

    • 5

      Take your toddler with you to the store. Compare prices together and clip coupons to demonstrate how to spend money wisely. Use cash to pay for items to give your toddler a visual representation of how much money is being saved and spent.

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