The media frequently reports that the economy is in rough shape and many of us are impacted in some way. Find out what your children are hearing in school, on the news and from friends and answer any questions they may have. Use this opportunity to explain what your family may be doing to cut back on spending and find ways to involve your kids in this process, e.g. Mom explains that when she and Dad take the two kids to the movie theater it costs $34.00 for the tickets, but the kids can choose a movie from the DVD rental box for $1.00. Let the kids do the math and discover that this is a savings of $33.00 for the family. You can take this one step further by using the $33.00 you saved on movies to shop for groceries. When the children see that the “movie money” will buy milk, juice, eggs, yogurt, bread and meat for the family, they really get the idea that smart spending is key to future prosperity.

Students in grade school often understand money but it is always helpful to define the term. Money is the official currency issued by a government that can be exchanged for products and services. It is a symbol which represents value in terms of goods or services.  

This definition in kid terms could be:  “Money is the thing – paper or coins – that the government creates and gives to people so they can buy things. Money is not actually worth anything all by itself. It is worth something because the government says that it is and we all agree. People used to trade in order to get what they needed. Before we had money, a baker would trade his bread with the farmer in order to get eggs. It is not very practical for a baker to carry bread with him everywhere though so he can buy things and it is not very practical for the farmer to carry eggs with him everywhere – so that is why money was invented – to make buying and selling things that we need easier!”  

Money can be a great motivator for helping kids learn basic math concepts. Counting, addition, subtraction, multiplication and division can be taught and practiced using coins and bills. Please visit www.superteacherworksheets.com for FREE printable worksheets on counting money and math practice. This website also offers a paid membership through which even more worksheets are available.

This is also a good time to start an allowance and open a savings account for your child. Make sure your child is involved in opening the account, making the deposits and watching the money grow over time. Make a habit out of contributing to the savings account. Remember, you are modeling for your child appropriate ways to be financially successful in life!