What Kindergartners Should Know About Money

When I had the opportunity to share money tips with my son’s kindergarten class, I settled on three main lessons. I figured I would pick some recurring themes from the personal finance topics I usually write about for adults — saving money, categorizing expenses and setting goals — and give them a kid-friendly spin.

What I didn’t realize is that the class also had a lesson in store for me.

Here are the tips I shared and the one I learned.

Save more than you earn

As a kid, if you get an allowance or host a lemonade stand, it might be tempting to spend everything you earn on a new toy or something else you want. But saving some money for the future can be helpful, because then you’ll have it later if you think of something you want even more.

I wanted to convey that saving money can be fun and can even become a game you play with your family. Noel Wilkinson made this point when I interviewed him about financial literacy. He's a program coordinator for the Take Charge America Institute within the Norton School of Human Ecology at the University of Arizona.

Younger kids can learn best through playing with their parents, he says. That might mean running around and comparing prices at the store or tracking savings goals on the fridge.

Learn the difference between wants and needs

Saving money can be easier if you get familiar with the concept of wants and needs. We might want a new toy, but do we need it? We might actually need new shoes.

Your parents probably take care of the essentials right now, but you can practice learning to recognize the difference between wants and needs to make better decisions about money and how to spend it.

When I rehearsed this part with my son, he suggested I shout out different nouns and ask his classmates to declare whether they were “wants” or “needs.” Together, we came up with a list. Clothes, food, candy, toys and games were among the options.

Set money goals and talk about them

One of my favorite personal finance topics is goal setting. I enjoy the brainstorming process and then adjusting the goals to be specific and measurable.

Kid-friendly goals might include saving up for a new game or hoodie. I encouraged the kindergartners to ask their parents about their own financial goals, such as saving for a vacation or college. I figured it could lead to a fun dinnertime conversation.

Turning to stories

I recently wrote an article about how to make learning about money fun and discovered through my research that storytelling plays a key role.

“There’s a reason the lessons we’ve learned for centuries are told in stories,” says Jessie Jimenez, an accredited financial counselor in Oregon and founder of the website Cashtoons.com, where she makes engaging videos about financial topics.

“Stories are easy to remember and carry a message with them,” she adds.

Classics by Richard Scarry (“What Do People Do All Day?”) and Dr. Seuss (“The Sneetches”) can explain the basics of economics and the free market, she adds.

For a concluding story time, I read Judith Viorst’s book “Alexander, Who Used to Be Rich Last Sunday.” Almost 50 years old, the story delves into the classic struggle of saving through a child’s perspective.

While Alexander has the best intentions to save his money, unexpected challenges pop up, making it difficult to do anything but spend it.

The surprise lesson

Just like Viorst’s protagonist, my day did not go as planned.

With the kindergartners seated in front of me, I started explaining my tips. They listened attentively, sometimes nodding along.

They enthusiastically shouted out their answers as to whether items were “needs” or “wants,” stopping only briefly to debate where clothes fell along the spectrum.

Then, in the middle of my explanation of the importance of savings, one child called out, “What about giving money to other people?”

Her classmates joined in. “What about people who need the money more than us?” “What about donating?”

One child explained how her father had taught her to divide her allowance into different categories, including one for other people.

I quickly realized these students were correct. I had left out one of the most important money lessons of all — how to use your money to help others.

Grateful for the fact that these kindergartners were so kind and thoughtful, I thanked them for teaching me a lesson.

Next time I talked to a group of children, I promised them, I would emphasize the importance of generosity, too.