Coming home one night, my 2-year-old daughter T came to me holding a supposed to be shopping basket, all our small grocery items were inside with labels of different numbers on a masking tape and she told me, “Mommy, what you want?” She is showing me the activity they did for today. A “Sari-sari store make believe.” I pointed a small biscuit and she gave me some rectangular papers with numbers in it and told me, “One pesos mommy.” Ok, I gave the paper with #1 label. She handed happily the biscuit that I pointed and told me, “sukli” 1 pesos. Amazed, I realized, my husband unknowingly is teaching my daughter, “numbers” as well as “money skills,” “sales process” and “entrepreneurship.”
Beth Kobliner, author of New York Times bestseller “Get a Financial Life” spearheaded the creation “Money as you grow”, which offers age appropriate money learning activities for kids.
Kobliner says, children as young as three years old can already grasp financial concepts like saving and spending. A study from The University of Cambridge revealed that kids’ money habits are formed by age 7. So, the sooner we teach them about money, the better off our kids will be since we, as parents are supposed to be our child’s first and best teacher. This article is part of the series, “Teaching Your Kids About Money,” the first part was: 5 Money Habits To Avoid Telling Your Kids
Lesson #1: You may have to wait to buy something you want.
Money Learning Activities for Kids: Ages 2
This is a hard concept for people to learn for all ages,” says Kobliner. However, the ability to delay gratification can also predict how successful one will be as a grown-up.
- Waiting hands. One of the things my daughter learned in attending Kindermusik (a music and child development program for babies until 7 years old) is the waiting hands. Teacher A would be giving out one toy and would pass around each child. Knowing how kids are, they could not wait. Along with our child, we were taught, ‘the waiting hands’ – it is putting your child’s hands in her lap and telling her to wait for her turn. Luckily my child immediately obeyed. But as I noticed, some parents are not as lucky as we were, they are having some hard time in keeping their child from grabbing the toy from the other child. But as the exercise becomes more frequent, I noticed that they all eventually learned how to wait. And they are all in the age of 2.
- Create a ‘Saving Jar’ or a Piggy bank. All the coins she received can be put in there. As early as two years old, I am already giving my child 5-10 pesos per day that she will put in her piggy bank. It’s a way of introducing the concept of saving.
- Play based learning. Like the Sari-sari store make believe play my husband did. It teaches numbers, sales process and entrepreneurship as early as age of 2. This play could be done as a child grows, getting more sophisticate. We now use “play money and coins” we bought at the bookstore.
Money Learning Activities for Kids: Ages 3-5
- Still, delay gratification. This concept could also be applied when your child is waiting in line for her turn to go on the “swings,” remind her to wait for her turn.
- From one jar, now, create three jars. Label it, “Saving,” Spending,” and “Sharing.” From a study, at age 3, children can now grab financial concepts. It’s time to level up the jars. From simple “Saving Jar” to three jars. You are teaching her the concept of saving, spending and sharing.
Have her use the spending jar for small purchases like stickers or small toy and money from the sharing jar can go to church when you go to the Sunday mass. It is a chance of teaching your child the concept of ‘tithing’ or giving to the Lord.
- For Saving jar, have your child set a goal, such as a toy. Make sure it’s not so pricey that she won’t be able to afford it in a few months and she just gets frustrated.” You are teaching her to save for a goal. You are now setting up your child to success. Every time your child adds money in the savings jar, help her count up how much she has, talk with her about how much she needs to reach her goal and when she will reach it. “All those behaviors are really fun for kids,” says Kobliner. “It gives them a sense of importance of waiting and being patient and saving.”
Which I seldom see in grown-ups today. Maybe they were not taught this important lesson when they were young.
Lesson #2: You need to make choices about how to spend money.
At ages 6-10, it’s important to explain to your child, “Money is finite and it’s important to make wise choices, because once you spend the money you have, you don’t have more to spend.” Kobliner says.
Money Learning Activities for Kids: Ages 6 – 10
- Include your child in some financial decisions, like telling her, “The reason why I chose to buy our fruits in the palengke is because, it cost less than buying it in the grocery store.” You can even bring your child along, when you buy some fruits, vegetables and meat products.” It would be a thrilling experience for them.
I can almost remember my experience when I was 7 when my mom brought me in the wet market “Palengke” in Pasay.” I liked the vegetables and fruit section since they are dry and non-stinky. But in the meat and fish section, I can almost remember, I was tiptoeing since I don’t want my feet to get wet and it stinks. I remember being “maarte” then. But looking back, I learned so much from that experience. I learned that, life is hard, you have to get dirty sometimes to get what you want and I also learned how to haggle. I’m now an expert in that field. Those life lessons, are things you cannot learn in “malls” nowadays. Where everything is dry, non-stinky, pristine, and expensive. Try it sometimes with your child. Bring her to the “palengke” — teach her about life.
- Give your child some money and have her make choices about what to buy within the budget you gave. For example, give her 200 pesos, then, have her decide what fruit to buy that will fit the 200 pesos.
- When you’re shopping, talk aloud about how you’re making financial decisions as a grown-up. Questions like, “Is this something we really, really need? Or we can skip it this week since we’re going out to dinner?” Or Would this cost less somewhere else?”
4. Have her participate in making your shopping list. “What do you think we need to buy?” Make sure she sees you making the list and using the list in the supermarket. This could teach her not to be an impulsive buyer since the only things you put on the list would be prioritized and not all that you see that you like would be included.
Lesson #3: The sooner you save, the faster your money grow from compound interest.
At this age, you shift from the idea of saving for short-term goals for long-term goals. The importance of saving not only for today, but also for the future. You can now introduce the concept of compound interest. This important lesson, I believe many adults in our society lacks. Actually, I am having a hard time writing this because, I know only few adults/parent might know this.
Money Learning Activities for Kids: Ages 11 to 13
- By this time, you can describe the concept of compound interest using specific numbers. Because research shows this is more effective than describing it in abstract, says Kobliner.
Explain to her: If you are giving her 200 pesos per day allowance, when she saves 50 pesos every day, that would be 1,000 pesos savings for a month.
Saving 1,000 pesos per month starting 13 years old and investing it in fund earning at least 8% earning compounding interest, that would be 8.5M when she reaches 65 years old. As opposed to, starting the same at age 25, investing 1,000 per month starting from age 25 to 65, that would only give her 3.4M pesos.
*If you, as a parent, still do not know this concept, educate yourself first. Watch out for my next post about compound interest.”
You can start by reading more here: “Saving Millions in Bank, How Safe it is?”
Money Learning Activities for Kids: Ages 14-18
- Teach her how to compute for compound interest. I will be teaching this one on my next posts, so please do watch out.
- Introduce her to the basics of stock investing. From passive investing like mutual funds, UITF, variable life. You can now start teaching stock investing directly. If you don’t think, this is possible, I know a 16 year old who trades and invest in the stock market as early as 15. Watch out for my next posts, I will try to interview him.
Kobliner, the one who suggested these activities, is an expert in the United States where stock investing there is a norm.
As I was writing this, I suddenly thought. How could Filipino parents teach their young ones how to invest if they themselves do not know how?
Now, that becomes a challenge to all of you, learn, study and apply first what you would be teaching to your child.
“Remember, you cannot teach what you do not know. You cannot give what you do not have.”
If your child is still a toddler, good for you, you still have a few more years to study before she reaches the age you need to teach these things, you have to be ready.
For those parents with teenagers, are not so lucky, since you have to learn as soon as you can so that you have something to teach your kids.
Learning is most effective when kids are ready to learn, that is what we call, “the teachable moment.” Unlike adults when it comes to teaching your child, sitting down and telling them what to do is not very effective, but they learn more things about life through play or the moments you have with them that presents an opportunity to teach. Take advantage of those “teachable moments.” As they grow into adults, they will surely thank you for preparing them to the reality of money.
For all the parents and adults reading this, I now, ask you:
What do you want me to write about in my next posts?
What do you want to learn? Please do comment below so that I will know what you want me to teach you?
Helping you to teach your kids,
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Read More:
• 5 Money Habits To Avoid Telling Your Kids
• 10 Signs You Are A Money Smart Mom
• How to get more than 50% discount for your child’s College Tuition fee
• How to save more than 50,000 Pesos by just bringing your child to a Pediatric Dentist
• 5 things you MUST KNOW in planning your Family’s Perfect Vacation while on a Budget
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