Using Spare Change to Teach a Child Life Lessons about Saving

I have endeavored to provide financial lessons for my six-year-old by giving her control over her money. I made the decision several years ago to allow her to keep any loose change around the house. There is one catch, she must keep track of how much money is in her “account," a shiny pink ceramic bear coin bank. Every time she adds the money into her bank, she counts it and adds to the total. I have her simply keep a sheet of paper and mark out the old total after adding the new one.

Next to her coin bank is a list of some of her favorite treats: ICEE, ring pop, ice cream cone, etc. Along with the list of treats is a savings goal. At six, it is funny what a child wants to save money for. My daughter once wanted to save up twenty dollars to get a twenty dollar bill (I just went with the flow on that one). Sometimes she holds some money back for one of her treats.  The important point is that she understands the value of the coins and she can comprehend how that translates into choosing how to spend.

It is amazing how a goal as simple as saving money can motivate even the youngest among us. There is a very small chance that loose coins in my household will not be gobbled up by this savvy six year old saver. Give a young saver the idea of what a quarter is worth in the world of “fun dip and tootsie rolls” and see what you can accomplish for 50 cents.

I strive to make it a learning experience when shopping for toys, treats, clothes, and the things that my daughter can pick out. At other times I may create a spending limit based on a gift card or cash amount which forces her to be conscientious of the trade offs or cost. 

There is a specific way I handle a situation when I know she will see an item she absolutely has to have. Before going inside, I give her some change and let her know she can spend it. I remind her that she can choose to spend it or save it, but it is her decision.

This is how I teach my young girl the value of money. I find that this approach is fun and exciting to her and plants a seed for how to handle money and save wisely. 

Kevin Stokes is the proud father a 6 year old who enjoys fishing and spending time with her grandparents. He is the president of Stokes Financial Strategies, LLC., a financial firm in Springfield MO. For 12 years, Kevin has given financial advise for over 400 client households. For a follow-up comment, Kevin can be reached at kevin@stokesfinancialstrategies.com