Teaching Financial Management at age 3
If you read the title you may be thinking a few things:
1. Lady you are crazy
2. My 3 year old couldn't care less about money
3. Isn't it a little young to be teaching this?
Answers: Debatable, Absolutley true, and Nope keep reading
We are not talking money, that is currency that matters to us. What currency do our toddlers deal in? Snacks, toys, screen time?
Many people are used to teaching their kids how to share but what about teaching them to trade?
This is an essential skill to teach kids because they learn so many lessons from experience rather than us "telling them":
1. Sometimes you need to give up something you have to get something you would like from another person
2. Nothing is free and there is not an infinite supply
3. Trading teaches choice in a different way and allows others (siblings in our case) the ability to say "no, thanks" but isn't a "he's not sharing" discussion
4. Prioritizes decision making; "Do I want ____ enough to part with my ___"
5. Allows for great critical thinking and social skills
It’s not about money - it is about currency…what is your toddler’s currency?
Here are 2 easy ways our family works to help teach them this skill.
1. Snack Time
As a mom, sometimes I just want to eat my own snack. All by myself! It is no secret, mom's food tastes infinitley better than anyone else's. Time to teach trading. I start with giving my kiddos their favorite snack and get myself a snack. Immediately, they want mine. Follow this example:
Kids get animal crackers, mom gets pretzels. The kids are wanting my pretzels. I simply say "ask mommy, would you trade me a pretzel if I give you an animal cracker?" I have found sometimes they really do want the preztels and other times they do not want to part with their animal crackers. But they learn valuable lessons - I could just give them my snack and they could eat theirs but then what would I be teaching?
I would be teaching them they can absolutley have what I have, there is no cost, and there is no "end" to what they can get. Oh and kiss a good dinner goodbye :_
Teaching "how to trade" allows them to see through experience that "if I trade away ALL of my animal crackers for pretzels I won't have any left." Whether they are okay with that or not is irrelevant. They learn what they have runs out.
2. Toys
Sometimes there is a time to share and sometimes there is a time to trade. I love watching my kids learn how to pay attention to the things their siblings like to conduct a proper trade. Example:
My son wanted to play on the "sit and spin" earlier this week but it was being occupied by his sister. Instead of throwing an absolute fit (which also happens sometimes!) his little wheels started turning. He ran to his bedroom and came walking out with a stroller, a baby, and a play baby bottle. One of her favorites. He brought it over and asked if she would like to trade a turn on the sit and spin for the baby game. Sister was so happy and jumped right off to play!
Don't understimate the amount of learning is taking place. People skills, learning to pay attention to what matters to others. Critical thinking, using that knowledge to set up a win-win scenario. Trial and error, learning to come up with another idea and another to see what trade may stick! And straight up reality, sometimes they get told no, no matter how many or how great the trades may be.
To wrap up, no toddlers don't understand the value of money but they do understand currency. You know your kids the best - what matters to them?
3 tips for success:
1. Let their "trade" run out (i.e. snack) once they have traded it away there is no more
2. Do not, I repeat, DO NOT remind them "if you keep trading your animal crackers you won't have any left" say nothing. If you set up a trade friendly (something you are okay with like my preztels for animal cracker example) say nothing.
3. Work on their vocabulary and sentence structure; have them ask appropriately for each trade
Today animal crackers, tomorrow their first savings account and beyond. You got this!
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