When teaching kids about money, at what age do you begin directly introducing your child to tangible money? In my survey of financial education literature, I found that the average age recommended was two or three years old—in other words, when your toddler is old enough not to try to eat the quarter you hand her.
Simply giving your child a few coins to play with may seems a little odd, but the article “Helping Kids Play Dough” by Gayle Ronan recommends giving toddlers coins to place in jars and shake, producing fun sounds. This kind of tactile interaction with money lays a subconscious foundation, associating money with positivity and fun in the developing mind. You could also let your child empty your pockets of change when you come home each day and put the coins in a coin dish, reinforcing the idea that even coins are important to keep and fun to collect. If they’re a bit older, let them count and sort the coins. A fun counting game is to have your children count your spare change and if they count it correctly, they get to keep it.
Once your child is cognitively further along, especially after they can count, there are games you can play with them to start to teach them the difference between different coins and bills. With my eldest daughter, I laid out a nickel and a dime and asked which she would rather have. I had read that most children choose the bigger coin, and true to form, she pointed to the nickel. I explained that, while bigger, the nickel has less value than the dime. Again, this concept is difficult if a child doesn’t have a basic grasp of numbers and counting.
You can try explaining this concept visually by making comparisons of stacks of coins. My daughter and I did an exercise modeling the different ways you can represent $1 in coins. First we stacked one hundred pennies, then twenty nickels, ten dimes, four quarters, two half dollars, and a single one-dollar coin, and I explained that each stack had the same value. Another idea is to put coins in context by revealing their purchasing power. You can set up a hypothetical shop with prices and let your child discover what each coin can buy them (e.g., one penny buys one candy, while a nickel buys five pieces). Try having your child play the role of the shopkeeper. As before, if they give you correct change when you “make purchases”, use that as an incentive and let them keep it.
For a guide to these kinds of games, try books like The Coin Counting Book by Rozanne Lanczak Williams or 26 Letters and 99 Cents by Tana Hoban. Neale Godfrey—author of several books on finances and children and founder and CEO of Green$treet Commons—also has a useful chapter in A Penny Saved that lists eleven different money games you can play with preschoolers, from coin Show and Tell to the Change-Making Game, wherein you and your child act out purchases and count the correct change. There are many online games, too, like the Disney Great Piggy Bank adventure or MoneyIsland from BancVue, and there are apps for download, such as the Money Math: Counting Coins app by Levott or Counting Coins by K12.