Teaching Kids the Value of a Dollar

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This post was underwritten by BMO Harris Bank, which offers a matching $25 on a new savings account opened for your child through their Helpful Steps for Parents program. Learn more at bmoharris.com/parents.

There are many critical skills that we as parents need to teach our kids.  One of the most important is to understand the value of money.  Its important to start instilling these values while our children are young (and believe most everything we say).  Here are a few tips to help you teach your child the value of a dollar. Piggy Bank

  1. Lead by example.  Parents, are you spending money on frivolous things when you should be paying down debt or building up that emergency fund?  With our children, its rarely “do as I say” but more “do as I do.”  Just as I can’t tell my daughter chocolate is not allowed before dinner and then open up a candy bar, I can’t expect her to spend her money wisely if I buyout Target every time I shop there.
  2. Explain what money is.  Not in a Warren Buffett kind of way, more in a Jimmy Buffett way.  By that I mean, make it fun.  Check out this cute Coin song that starts off with, “Penny, penny, easily spent, copper and brown and worth one cent.”  You get the picture.
  3. Use play money as currency.  Depending on the age of your child, you may not want to shell out the real stuff.  My two-year old loves to go “grocery” shopping.  Usually this occurs in her playroom and she buys whatever toys are on the shelf.  Using our toy cash register and play money, when she is finished shopping, she checks out and “pays” me.  Sometimes I’ll tell her she doesn’t have enough money and that she’ll have to put something back.  By doing this she has to make a choice on what is more important: the cupcakes or the crayons (she usually picks the cupcakes).  Sometimes she has a meltdown, but hey, I’ve seen adults to that too.
  4. Give them cash.  What?!  Give a two-year old cash, are you crazy?  Didn’t you just tell me to use play money?  Yes, I did.  But here is my reasoning.  The other day we ran out of milk and I asked my husband to run to the store to get some.  My daughter became all excited and want to go buy the milk herself.  We gave her three one dollar bills, put them in her play purse and at the grocery story, she paid for it by herself.  My daughter came home with the change and told me it was for, “more milk.”  She had conceptualized that the change she was given could be saved to buy more milk the next time we needed it.  Even little kids know the difference between the real and play stuff.  TIP: Make sure the grocery store is not busy when you have your two-year old pay.  It takes forever. :)
  5. Start saving.  The unfortunate reality is that most parents spend more money on photographs of their children in the first few years of life than they do on saving.  In our family we’ve made the commitment to put 50% of any cash that my daughter receives for birthdays, Christmas, etc.  into a savings account just for her.  She’ll get the best of both worlds: the ability to spend a little of her money (if she wants to, notice how kids don’t like to spend their OWN cash?) and a little nest egg for the future.

Hopefully these tips will help you teach your child the value of a dollar and the importance of saving money.  Have you started teaching your child the value of money?  If so, so, I’d love to hear your tips and tricks!

I was selected for this sponsorship by the Clever Girls Collective. To learn more about BMO Harris Bank, visit their website http://bmoharris.com/parents.

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About Sarah

Mom. Blogger. Runner. Hiker. Insomniac. Not necessarily in that order.


  1. All very good advice. It is so important for kids to learn these financial basics at home.

  2. Great tips!  So important to teach early!

  3. I agree it is important to start teaching kids financial responsibility early. Great advice and tips, thanks!

  4. While I agree that it is important to teach children financial responsibility I think that is different than the value of a dollar that BMO Harris tries to convey in their commercials. Either way it is still important.

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