Ask kids this question, and enjoy a wide range of hilarious and eye-opening answers!
“From the ATM machine.”
“From your wallet.”
“Dad pays you, right?” (Ouch.)
Money might seem to grow on trees as far as your kids are concerned, but it is fall… and well, as the leaves dwindle with time, so can the bank account if we don’t help our kids understand that money is a finite resource! In the age of ATMs, debit cards and credit cards, it might look like money is a never-ending resource and that you can just go to the bank or a machine and get some, especially to a child.
Because young children may not have a connection yet to the fact that you go somewhere every day to work and get paid for that work in order to live, parents can be viewed as “money machines.” One way to expand their view is to help them understand where money comes from in the simplest of terms.
It can be helpful when answering the question “where does money come from?” to first find out what your child actually knows, and what they think vs. what is real.
A good starting question might be “Where do you think money comes from?” This will help you clarify what your child understands, as well as give you a chance to correct misconceptions. Then you might move on to “How do you think our family gets money to pay for things?” and share a simple answer about working and being paid for what you do.
If your child is curious about the literal aspect of where money comes from, you can give an answer about how physical coins and paper money are created—or share a video like this one from Reading Rainbow.
Another way to help your child understand money is to explain what the bank is. Share that it is a place to keep the money you earn and that it helps you keep track of what you have and spend. An older child could benefit from viewing your last few transactions in your online banking account, and you may choose to share with them what you pay for with cash, vs. automatic debits or by using your card.
Above all, make sure they understand that the bank isn’t paying you (wouldn’t that be nice, though…)—they are simply holding on to the money you have earned in a safe place until you need to use it.
Have you had a conversation like this with your kids yet? What did you say? Share your additional tips or thoughts in the comments.