First Money Lessons

Storyteller recently learned a big money lesson. For a while now she has been earning a weekly commission for some of the work she does around the house. We’re big Dave Ramsey fans so our kids get a commission rather than an allowance. They work for their money and if they don’t work then they don’t get paid.  They each have give, save and spend envelopes. They put their coins into their piggy banks and every now and then we cash them in for bills and they divide those up between the envelopes.  When we cash in their piggy banks we have them sort the coins and we help them create piles that equal $1.  Storyteller teller already knew the names of the coins by the time we started this but these exercises have helped illustrate the value of each of the coins and how they add up to dollars.

We wanted this to have meaning for her pretty quickly so as soon as she had a dollar in her spend envelope I took her to the 99c store to pick out a coloring book. We wanted her to make the connection that work = money = buy new toy. Obviously, there’s a bit more to it than that but she was only 4 years old when she made her first purchase. She made that connection well but it was hard to get her to understand the idea of saving for a bigger toy. She always chose the 99c coloring book over saving up for something else. We let her make those choices for a while until it finally clicked. By then she was well aware that if she wanted a new toy she’d have to buy it herself or wait for Christmas or her birthday and hope she received it for a gift. When she saw a toy she wanted I’d always ask if she brought her money. And of course the answer was always no.

Fast forward to just after her fifth birthday. She decided she wanted to buy a specific doll. It was $32. That’s a big jump from 99c! But she was determined that she had to have this horse riding doll named Shannon. She saved her coins from commission and any money she received from her birthday and Easter.

A few weeks ago, she finally had enough money to buy Shannon. Comedian was watching all this unfold over several months. She’s now 2 1/2 years old. She had no interest in doing work for a commission but now that she’s seen Storyteller go through this process she finally wants to earn some money.

When we go to a store with toys I let the girls look through the toy isles after we get the shopping done. The whole time they say, “When I save up my money I’m going to buy this toy!”.  That always makes me smile.  The next step is to help Storyteller use her give envelope.


4 thoughts on “First Money Lessons

  1. Love this! I’ve been trying to come up with something like this for a while now, but my attempts have been very unorganized. Do you chart your daughter’s completed chores or anything? How much commission do you give, if you don’t mind my asking? Thanks for the post!


    1. Our long term goal is for them to choose to do the work instead of being forced which is difficult because they are just starting to understand the purpose of money…spending and giving. Our oldest (5 yrs old) got 50c a week for emptying the dishwasher every morning and cleaning her room every night. We just added clearing the dishes from the dinner table for another 25c a week. She gets the day off from the dishwasher and dinner dishes on payday. I don’t think she gets paid enough so we’re talking about raising it to probably $1 a week. Our youngest (2 1/2 yrs old) gets a nickel every time she sets the dinner table with silverware and napkins. They also get money from other sources every now and then. Our approach has been pretty unorganized too and it changes often as we try to improve it. And we’ve found that different things work for each kid. That’s it in a nutshell. I think I’ll write up a post about the details of how this process has been for us. Thanks for the comment!


      1. I do like this idea very much, yet…the one thing that pops into my mind is the lesson that every thing they do, especially helping around the house, is worth money, and must be motivated by receiving something. Do you do anything to counteract that lesson?


        1. Yes, I completely agree. They do other work around the house that they don’t get paid for. Sometimes they ask to get paid for it but we explain that there are some things they need to do just to help out our family. As they get older I’m sure it will shift to where they do more for no pay around the house and earn their money by helping neighbors (mowing lawns, pulling weeds, walking dogs) or selling things they make etc. But for now, I’d rather have them earn money for some of the work they do to give them the early experiences of learning what money is used for and how we earn it. Both my husband and I also volunteer in the community and the girls actually come along with me sometimes so that opens the door to talk about volunteering.


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