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How do I teach my 5 year old the value of money?

So my almost 5 year old son has been coming up with a lot of extravagent "I wants" lately. He doesn't understand that everything costs money and that dad works very hard for that money. What is a good way to teach him the value of money and that you don't always get everything you want?

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Asked by Anonymous at 8:05 PM on Jun. 19, 2010 in School-Age Kids (5-8)

Answers (20)
  • Make him work for it. Let him do work around the house to earn money and then show him how much things cost.

    Answer by lowencope at 8:08 PM on Jun. 19, 2010

  • most adults don't even know the value of money haha. he's not really going to understand until he learns math

    Answer by aliishott2 at 8:10 PM on Jun. 19, 2010

  • Let him earn an allowance. You can assign chores, and either give him an amount at the end of the week, or an amount per chore. Then when he wants something, he can dig into his piggy bank, and pull out the money he needs. But, make sure he knows that once the money is gone, that's it, until he earns more.

    You can also check into your bank and see if they have a Kid's Club type savings account. That way, if you would like him to save a bit of it, he can feel "grownup" about it. That is, if he likes that sort of thing. You could even encourage saving by "matching" what he saves, if that's within your budget.

    Answer by makelineerror at 8:18 PM on Jun. 19, 2010

  • Chores and allowance. It's great when DS says he wants such and such and I can say - well, you can save up for it. A lot of times he'll find something new he wants to spend his money on and I'll remind him of that expensive thing he wanted, and he'll say, "Oh, well, that can wait," so I guess it really wasn't that important after all.

    Answer by Anonymous at 12:53 AM on Jun. 20, 2010

  • I agree - start a chore list. He can earn a certain coin value for each completed job. He fails to do his job, he fails to earn the cash associated with it. Take him to the store with his list of wants. Help him look up the price for at least his top several. Write it down! Start a savings jar - glass or clear plastic so he can "see" the money add up. On pay day, put his earnings his the savings jar. Talk about how much he's saved and how much is left to earn. Associate it back to the jobs he does. "This week you earned $2. The Silly Bandz you want are $5. You will need to clear the table, load dish washer, feed the dog and help with the laundry for two more weeks in order to earn enough money to pay for your Silly Bandz and the tax on them." If he just HAS to spend the cash before that? Fine. It's his. Let him. THen let him see that the ice cream truck buy set him back another week for his Silly Bandz goal. ;)

    Answer by ldmrmom at 12:17 AM on Jun. 21, 2010

  • (cont) fwiw - my oldest bought himself a $40 DS game by saving up for it. He still talks about the accomplishment. Yes, he still has a list of wants...for example the Silly Bandz he was mad we didn't buy for him yesterday. However, the protest also die down a lot faster now when we point out that he had spent his money on a set of cards for Club Pengiun last week and if he had saved it, he coudl have bought the Bandz he wanted this week. We remind him of his game and how long it took to save for it and that he has to make a list of priorities. I don't thing there's anythign wrong with saying "No, that cost money and I don't have the extra to give you right now." Or "No, you don't NEED that and I'm not going to buy it for you just because you WANT it." We talk a lot about wants vs needs. They get it...sooner or later. ;)

    Answer by ldmrmom at 12:21 AM on Jun. 21, 2010

  • DS goes shopping with us. Kids that age understand more or less. Just like the other day, he wanted drumsticks (I am laughing because there is a drumstick add on the page right now) They were four for $3 which would give him four treats. The ice cream tub we usually buy once a month is $5. he gets that treats for nearly a month is a better deal than treats for less than a week. Obviously it gets more complicated eventually, but for now we teach More or less, which is a better deal?

    Answer by Liansmommie at 12:57 AM on Jun. 21, 2010

  • have chores that he gets paid for. My son has 3 jars, 1 for spending , 1 for saving , 1 for charity. for every dollar he earns 50 cents go into the saving jar, 10 cents into charity jar and 40 cents into spending jar. If he banks all of the money in his savings jar (we go to the bank every 3 months or so for his deposit) Mom and dad will match what he deposits.
    if there is something he wants we hang up a picture of the item and how much it costs then he saves for it. He can earn extra $$ if he wants to by asking us if we have any thing we would like him to do.
    He also has a worm farm and when school ends he will be selling worms as bait. If kids can come up with a mini business idea that is a good thing for them to do. It teaches them a lot.

    Answer by justgrape723 at 8:59 AM on Jun. 21, 2010

  • Thank you for all of the replies, very helpful!

    Answer by momoftwoboys197 at 9:42 AM on Jun. 21, 2010

  • My DD is 5 and she does chores to earn her money. Not hard ones, but simple things like keeping her room picked up, feeding the dog and letting her ouotside, bringing her laundry to the laundry room, helping me put away groceries etc. She earned quite a bit of money at our garage sale last weekend because she went through her toys and got rid of some.

    When she does earn money, we have a rule. She only gets part of it to spend on what she wants, the rest is divided up and half of it goes into her bank account and the other half goes in a jar for her to give to charity, whether it's at church or when we are out and about.

    Like a PP said, we also do the picture thing where we hang up a picture of something she is saving for. It really helps her learn about money, especially since when she goes to her dad's house him and his mom buy her pretty much everything she wants.

    Answer by zoeysmom331 at 11:31 AM on Jun. 21, 2010

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