It’s never too early to helps kids understand accounting – the concepts of earning and spending. Here are a few ways to teach your little ones about how money works and even have a little fun.
Play Money Games
One way to explain the principles is by playing games like Monopoly and The Game of Life. However, if you want to be more homegrown and less commercial, bake some cookies, bag and price them, and turn your kitchen into a store. You might even get a toy cash register and calculators to make the whole experience more authentic. Then record the earnings, expenses and profits. This will really give children a “taste” of accounting!
Create a Family Budget
When sharing this activity with your kids, you don’t have to include every single expense – just those that they can easily understand, such as mortgage or rent, electricity, gas, phone, groceries and so on. Then, ask them to write up a budget of their own and include their income and expenditures for an allotted amount of time, perhaps a week. This way, you can demonstrate the importance of tracking money and explain that this is a common way that businesses and families deal with their finances.
Teach Them About Checking Accounts
Even though checks are being used less and less these days, a check register is still a good way to show kids how to reconcile expenses. First, you can let them watch you write a check, then explain how to record the check in the register. Then, get some generic deposit slips from your bank and demonstrate how deposits and withdrawals work. Finally, tell them that these transactions will be sent to them each month in a statement – you might even show them one you have to help them visualize the concept.
Explain Debits and Credits
Grab a blank sheet of paper and write a large T on it. Above the left side of the bar, write “Income: Money In” and above the right side of the bar, write “Expenses: Money Out.” Point out the difference between the two sides. If your child has an allowance, a way of earning money by doing chores or if they have a summer job, then ask them to pretend that they’re going to spend some of their money on things they’d like, such as games or candy. Have them record the amounts of earned income in the left column. Then ask them to imagine spending the money on the things they want and have them record those expenses in the right column. Then subtract the expenses from the income. This is quite effective because it helps kids see the money going in and out of an account. When they get a feel for how this works, they might be a little less interested in spending every cent they earn.
There are many other tools you can use to teach your children how money works, but these are a few good ones to get you started. As many parents can attest, helping kids comprehend how to manage money is one of the best lessons you can teach them.
“Copy as Website Link” gives you ready-to-paste HTML for a web page. “Copy Link” copies the plain address for social media, email, or chat.
McSwain & Company, PS
Pass It On: Accounting Tips to Share With Kids
August 1, 2019 · Blog, Tip of the Month, Uncategorized
⏱ 4 min read
It’s never too early to helps kids understand accounting – the concepts of earning and spending. Here are a few ways to teach your little ones about how money works and even have a little fun.
Play Money Games
One way to explain the principles is by playing games like Monopoly and The Game of Life. However, if you want to be more homegrown and less commercial, bake some cookies, bag and price them, and turn your kitchen into a store. You might even get a toy cash register and calculators to make the whole experience more authentic. Then record the earnings, expenses and profits. This will really give children a “taste” of accounting!
Create a Family Budget
When sharing this activity with your kids, you don’t have to include every single expense – just those that they can easily understand, such as mortgage or rent, electricity, gas, phone, groceries and so on. Then, ask them to write up a budget of their own and include their income and expenditures for an allotted amount of time, perhaps a week. This way, you can demonstrate the importance of tracking money and explain that this is a common way that businesses and families deal with their finances.
Teach Them About Checking Accounts
Even though checks are being used less and less these days, a check register is still a good way to show kids how to reconcile expenses. First, you can let them watch you write a check, then explain how to record the check in the register. Then, get some generic deposit slips from your bank and demonstrate how deposits and withdrawals work. Finally, tell them that these transactions will be sent to them each month in a statement – you might even show them one you have to help them visualize the concept.
Explain Debits and Credits
Grab a blank sheet of paper and write a large T on it. Above the left side of the bar, write “Income: Money In” and above the right side of the bar, write “Expenses: Money Out.” Point out the difference between the two sides. If your child has an allowance, a way of earning money by doing chores or if they have a summer job, then ask them to pretend that they’re going to spend some of their money on things they’d like, such as games or candy. Have them record the amounts of earned income in the left column. Then ask them to imagine spending the money on the things they want and have them record those expenses in the right column. Then subtract the expenses from the income. This is quite effective because it helps kids see the money going in and out of an account. When they get a feel for how this works, they might be a little less interested in spending every cent they earn.
There are many other tools you can use to teach your children how money works, but these are a few good ones to get you started. As many parents can attest, helping kids comprehend how to manage money is one of the best lessons you can teach them.
“Copy as Website Link” gives you ready-to-paste HTML for a web page. “Copy Link” copies the plain address for social media, email, or chat.
Disclaimer
These articles provide general information on tax, accounting, and financial topics for small businesses and individuals. They are educational in nature and are not specific legal, accounting, financial, tax, or other professional advice, and should not be relied upon as such. This content was prepared by Service2Client and may have been reviewed or edited by the website owner for accuracy and compliance. Look for a trust mark below for verification details. No representation is made that any approach described will achieve a particular result, and no regulatory or professional body has reviewed or endorsed this content. Because each situation is different, readers should consult a qualified professional about their specific circumstances before acting. Images accompanying these articles are protected by copyright and may not be copied or reused.
It’s never too early to helps kids understand accounting – the concepts of earning and spending. Here are a few ways to teach your little ones about how money works and even have a little fun.
