Here are some guidelines for helping preschool children learn more about the basics of money.

The first lesson that should be understood by preschool children is that money can be used to buy things.  In exhange for dollars and/or cents, you can get something to take with you. The second lesson is to help preschool children learn how to identify money – dollars and coins. Once children learn that money buys things and how to identify money, then preschool children should learn how to count money. Finally, preschool children should learn to save and spend a small amount of money for inexpensive items that are very important to the child.

Read on to learn more about the details of these lessons:

Money Buys Things

• Have kids put money in vending machines
• Kids watch you exchange cash with cashier then have kids hand cash to cashier and get the change
• Buy something simple with a penny first, then nickel, etc. (Ex. 1 penny per cracker, five crackers for a nickel (Raising Money Smart Kids))

 Identify Money

• Identify coins in three ways 1) size, 2) name 3) number value (Money Doesn’t Grow on Trees)
• Go over all of the different pieces of money = penny, nickel, dime, quarter, half dollar, dollar bill (try to stress that the dime is worth more even though the nickel is bigger)
• Play heads and tails with the coins
• Take images of the coins in Play Doh or clay (Raising Money Smart Kids)
• Rub the paper with a pencil until the coin images appear – then scramble and have kids put coins on the right image (Kids and Money)
• Gathering up loose change from around the house, see if the kids can name the coins, kids get to keep the coins they find
• Get a small treasure chest and hide money it. Have a treasure hunt and whomever finds the chest gets to keep the money. See if the child can name the coins.
• Visit a change sorting machine at a local store

 Count Money

• Count by 1s, 5s, 10s, 25s
• Various combos make up a quarter
• Dollar coin = dollar bill
• 100 pennies = one dollar
• Count change from the smallest denomination to the largest

Save and Spend Money

• Put money in jar or piggy bank to save up
• Open a pretend store or restaurant
• Play board games such as Monopoly Junior
• Use educational toys such as ATMs and cash registers
• Start shopping with the child and use his/her small savings to purchase a desired item – save up a little bit more each time

References 

1. Clark Smart Parents, Clark Smart Kids (Howard, 2005)

2. Kids and Money (Searls, 1996)

3. Money for Teens (Shelly, 2001)

4. Money Doesn’t Grow on Trees (Godfrey, 2006)