At What Age Should You Teach Your Child About Money?

At what age should you teach your child about money? The answer is the sooner the better. I started teaching my son about money and finance at the age of 5 and now he’s conscientious about shopping. When he was 4, I took him to the opening of Cars Land at Disney California Adventure Theme Park. It was Christmas time, so the park was all decked out in Disney holiday cheer. We were staying at the Hilton and I almost forgot that we needed to have cookies for Santa Claus.

I went to the reception desk and explained my scenario to the clerk. I guess the story was so cute and the little boy looked so sweet and innocent sleeping in his stroller that the clerk replied, “We’ll make sure he has cookies for Santa.” Later that evening, the plate of sugary treats arrived with a knock on the door and a peppy staff member who proclaimed with glee, “I hear we have a little boy in here who needs cookies for Santa?”

It still makes me cry to think of how nice they were to go the extra step in helping me make his trip special. Not every little child at the hotel received cookies for Santa and they didn’t even charge it to my bill. While I thought this was an experience of a lifetime for him, what with him getting to be in Radiator Spring and meeting Lightning McQueen, Mater and the whole gang, my son wanted to spend most of his time at the souvenir store burning through a lot of money.

Of all the traits I wanted him to pick up by spending time with my mother, a shopping bug and affinity for the Hallmark store were not among them. So, when his father’s sisters wanted to take him and his brothers and cousins back down to Disneyland the following February, I became concerned that he would spend a lot of time bugging them to buy him this or that at the stores. I didn’t want them to have to deal with that or appease him over the other kids.

I decided to do something unheard of by other parents of young kids. I decided to send him down there with a $100 gift card so he would have his own money to spend. I know, I know. Am I crazy? He’s going to lose that kind of money or get it stolen from him. Well, that was the risk I was willing to take. But first I needed to take him to the store and teach him about finances.

We went to Toys R Us (so sad they’re no longer in business) with $20 he had received as a gift. These kids are making bank from money they get for birthdays, holidays, and several other sources that we don’t even realize. They learn how to spend money from the same advertisements that provoke you and I to buy, buy, buy. What they don’t always learn is how to save some of their money or manage it. My son was going to learn how to manage his money today.

I told him to go find what he wanted to buy. He went to the boys isle of the toys section and selected the 1:64 dicast NASCARs. “Ok,” I said. “How much do they cost?” I asked.

He shrugged his shoulders not knowing the answer. I pointed to the tag by the item he wanted to purchase and explained, “Whenever you want to buy something, you always need to look for the tag that tells you how much it costs. How much is one dicast NASCAR?”

“$5.00” he replied.

“How much money do you have to spend?”

“$20.00.”

“So how many dicast cars can you buy?” This was also a good lesson to show him how he will use the math he learns in school in the real world.

“I can get 4 of them.” He responded.

“Because $5.00 times 4 is $20.00, right?”

He shook his head yes. “Ok, then let’s take your items up to the cashier to pay for them.” I told him.

We took his items up to the cashier and I had him put them on the conveyor belt. It’s important to have the child physically go through the whole process instead of doing parts of it for them.

“Watch as the cashier rings in your items. You want to make sure the price is the same as the price on the tag where you got it from, and you want to make sure they ring everything up correctly.”

He watched as each one of the four dicast cars went across the scanner and rang up on the monitor. When the transactions were complete, I asked, “So, how much does it say you owe?”

“$21.90.”

“And how much do you have?”

“$20.00.”

“Do you have enough to buy what you want?”

“No.” he said.

“Why not?”

“I’m short $1.90.”

“Did you account for the tax?”

“What’s tax” he asked.

“It’s the amount we pay to the government in order to buy things in stores.” I said.

“I didn’t know about tax.”

“Do you need a loan for the $1.90?” Just kidding. He already had to learn about taxes, no need to go into teaching him about loans and borrowing money.

The day arrived for him to go on the Disneyland Trip. He had his suitcase, a new wallet, and the $100 gift card. I chose a gift card where I could monitor his spending online. As the days of his trip went by, I kept watch of the card but the $100 never changed.

When he returned home from the trip, I asked him, “So what did you buy at Disneyland?”

“Nothing. They gave each of us a souvenir.” He replied.

“So, what happened to the $100?”

“I still have it. I wanted to use it to buy things here.” He said.

I was surprised. The one scenario that didn’t come to my mind. He chose to save his money and spend it another time. That was the start of him learning how to manage his money. My son is now twelve years old and he’s not an impulse buyer. He thinks carefully about what he purchases and if he needs to purchase it now before he buys it.

When he wants things and it’s not his birthday or a holiday or any other occasion when he would receive money, he’ll ask me if we have enough money to buy it. However, knowing that he does receive money on his birthday or holidays or other occasions, he does write out the things he would like to buy when he has his own money.

If you enjoyed this article, please consider leaving a heart and/or a tip. I’m fundraising to support my son’s goal of becoming a race car driver, so all tips go to his racing team JBS Sports as well as donations to help fund youth athletics. Thank you for contributing.