7 ways to teach kids the value of money
Research commissioned by The Royal Australian Mint has found that 67 per cent of parents worry that the switch to mobile and card payments will affect a child’s ability to understand the value of money. The Mint’s Australian Dollar Discovery program, which launched in November, is aimed at engaging families with coin collecting, while also encouraging financial literacy among children.
“It is so important for kids to learn the value of money, especially in a world that is becoming so reliant on cashless technology. Coin collecting to many adults is a nostalgic memory however it also teaches skills of persistence, patience and financial literacy. Our exciting Australian Dollar Discovery competition provides children with a powerful learning opportunity and an accessible way to start their own coin collections” says Ross MacDiarmid, CEO of the Royal Australian Mint.
To help inspire more parents to pass along their beloved childhood hobby to their own children, the Mint has put together some of his top tips to teaching kids how to save for the future, including participating in Australian Dollar Discovery.
1. Collect coins
Beth Kobliner, best-selling author and financial journalist, says children as young as three years old can grasp financial concepts like saving and spending. A great way to introduce young kids to the world of money is encouraging them to create their very own coin collection. Not only is this a bit of fun, it also teaches kids about different coins and which ones have more or less value than the rest.
2. Participate in Australian Dollar Discovery
Australia’s first ever coin hunt provides families with the chance to start their own collections. With three million $1 coins with the letters A, U and S being released into circulation, this is an exciting medium for children in every Australian state and territory to check their change for the special coins and learn about the value of money along the way. Find out more at dollardiscovery.com.au.
3. Start saving with a piggy bank
The Mint found that 57 per cent of parents agree that a lack of physical contact with money can affect a child’s ability to save, introducing kids to a piggy bank can be a great way to combat this. You can also get them to create three jars for spending, saving and sharing to teach them to manage money to spend/save and help others.
4. Open up a bank account
A piggy bank is a good way to start kids off when it comes to saving and once the piggy bank is full a bank account is the most efficient way to deposit their savings. Kids will gain a better understanding of money and how money works after knowing how much money is being deposited in their very own account. This also motivates kids to continue saving by watching their money grow.
5. Teach children the right way by example
Kids tend to learn more from their parents actions, not just their words. A sense of self-discipline when it comes to spending is an invaluable tool to teach your kids so that they can make wise choices when it comes to their own money. Teaching kids where money comes from, where money goes and what to spend money on when it comes to ‘needs’ and ‘wants’ will give them more insight into the world of money.
6. Reward them for doing jobs
A report by researchers at the University of Cambridge commissioned by the United Kingdom’s Money Advice Service revealed that kids’ money habits are formed by age 7. To get your kids thinking about where their money comes from think about introducing a pocket money system to reward them for doing small jobs around the house.
7. Creating a timeline to reach a goal
At a young age, concepts of money and time can be hard to understand. An easier way to help kids grasp on the idea of money is by giving them a visual aid. Grab a long piece of paper and record every time your kid gets money on a timeline from $0 to $100. This will help illustrate how much money they’ve saved and how much they need to reach their goal.
For more information on coin collecting go to www.dollardiscovery.com.au
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