How I Am Teaching My Toddler About Money

If you were to ask me when I was a kid if we were poor, I would have said no. I lived with my grandma and I don't know if it was out of guilt, a sense of duty or just a plain old shopping addition but I never went without anything. If there was something I wanted and I asked for it enough, it would be mine.

If you were to ask me now if we were poor, in hindsight I can certainly say "Yes!" We lived on my Grandma's fixed income pension and some government money that everyone in Canada receives for their children under a certain income bracket. My Grandma would quite often go without to give me the things she thought I needed, whether we could afford them or not.



Not only did she sacrifice for me, but I sacrificed some pretty substantial things for basic material things, more than I could have ever realized at the time. We lived in a ratty old trailer, no proper insulation, holes in the floor -- definitely somewhere I could never expect my children to live. I'm not angry or upset about this, in fact I think that growing up that way has given me character, but I do see the error in it now.

We sacrificed our quality of life for basic material things. Clothes, eating at restaurants, toys upon toys upon toys, Christmas trees loaded with presents underneath them and every somewhat inexpensive material object I wanted. I wouldn't say that I wasn't grateful, I knew, even then, that my Grandma gave me a lot and to be grateful for it, but I know that I would've traded all of those toys and nice clothes for a home where I felt safe and warm.

My Grandma was often so focused on buying what she thought I wanted, she didn't save and she spent whatever she had. We'd often be well behind on bill payments and her credit was maxxed out almost always. I picked up some of those spending habits into my working years because I was never taught to manage money properly. Money has always burned a hole in my wallet until I could spend it and that's something I've been actively trying to change since starting our family.

One thing that has become increasingly important to me as a Mother is teaching my children the true value of money. As things become more and more expensive its even more critical that they learn these skills for their adult lives now.

So (with the help of Sesame Street, thanks Elmo!) I came up with a Savings System created for my children, to teach them the value of their money and how it should be appropriated!



Here's how it breaks down: 

Step 1: Earn
In order for Cash to earn his money he has to accomplish chores throughout the house. Since he's 3 his chores are pretty basic, but these can be increased in value and difficulty as he ages.

Right now Cash earns 3 quarters daily (one for each Jar) for cleaning up his toys before bed time and helping me change his brother by throwing the diapers in the potty. He can earn more if he does more, like putting his plate in the sink, helping me put the laundry in the machines and tidying up outside of his scheduled clean up time.

Step 2: Divide
Cash has 3 Jars, one for Saving, one for Spending and one for Sharing. When we made the jars together we also decided what he would do with the money from each jar.

Saving: This money will go towards a savings account in his name.

Spending: This money will go towards any toy or treat he wants, BUT he has to remember to bring the money with him when we go out, if he forgets it he has to wait until next time.

Sharing: This money is being saved towards a Christmas present for his friend at daycare. This is what he chose when I asked him how he would like to share this money, so whatever we save by Christmas will go toward this.

At some point, when he's closer to 10-12 I will open three bank accounts in his name with the same intentions. This will hopefully bridge the gap when he starts working his first job and he will learn to appropriate his money the same way.

I know I wish I had!

What do you think about this way of saving money for your kids? Would or Do you do anything differently?