How early for money management? The sooner the better and the use of simple day to day experiences go a long way as teaching tools!
5 year-old Andy gets a $25 Toys R Us gift card for Christmas.
Andy’s first lesson is to determine what he wants to buy.
He decides on a Tonka truck costing $39 (before sales tax)
Andy now has to do some thinking about a budget:
1) He can find a smaller truck costing within his financial limitations
2) He can save the gift card until he has the additional money needed
Andy has now had the experience of living within his means.
1)He doesn’t get to borrow from his parents (credit card debt)
2)He does get to plan for the future (savings)
3)He does have the opportunity to make a decision (financial planning)
You say, Andy doesn’t understand math in this way because he is only five years old and way too young for such an undertaking.
I say, Andy will learn about money this way and be ahead of the math lesson when he gets to the front seat in his elementary school classroom.
This takes patience and conversation on the part of parents. It also means, every parent has to know their OWN child as some kids may not be able to handle this situation at the age of 5. But many of them can and have done this kind of learning.
Curbside Parking the family car and feeding the meter is money management simple enough for kids to learn from.
Four (4) quarters for an hour to park but you don’t have any change and you are running late for your appointment.
The parking lot on the corner is your next opportunity but with a $5 flat rate.
You’re only needing two hours at the most. Your kid has wit-nessed this and you are talking about what’s going on, so hopefully a lesson has been learned or at the least a true to life time and money management experience has been witnessed and discussed teaching:
1) plan ahead
2) time is money
3) not being prepared is expensive (in this case $3)