4 December 2008 12:49 PM

The Value of a Dollar

by Dr. Rick

In these times of economic uncertainty and the need for more conscious penny pinching, it is as good a time as ever to teach our children about the importance and value of money. Some say the best way to teach kids about money is to buy them games and other “products.” Instead, I think it's best to teach kids about money the same way we teach them about other important life topics – through our role modeling and values.


For example, when your kids are around five or six, begin teaching them the “money basics.” While you're doing this, you'll inherently teach them your values such as saving, charitable giving, and living within a budget. You can start by explaining how to identify coins and bills, how much each is worth, and how to make change (this is a math lesson, but the kids don't need to know this). 


There are other important lessons, too, which your child will take to adulthood. A great one is earning (as opposed to just receiving) an allowance and what to do with that money. We can teach about the value of saving a portion of that allowance. (Americans have one of the lowest savings rates in the world. That's not good.) We can open a savings account and let children see their amount grow with steady deposits, however small.


We can teach about setting goals, about giving to others less fortunate, about contributing to charities we endorse, and about saving for a big purchase. We can teach the difference between “wants” and “needs.” We can even teach about the pleasure of the occasional splurge.


We can take our kids shopping with us and let them see us determine the best deals (have them help with this -- more math lessons). We can show them how we critically read, watch, and respond to commercials and ads.

Learning about money is sort of like learning about love. There is much for kids to learn, and the best way for them to learn about it is through the good example of the adults in their lives.


If you have special ways you teach your children about money and math, we would love it if you shared your comments.


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