How to Teach a 3 Year Old the Value of Money

Updated on May 06, 2008
E.K. asks from Wichita, KS
10 answers

I have a 3 1/2 year old son that is somewhat spoiled. My fault I know. Yesterday he was on the phone with his grandmother; my mom and he asked her to buy him a game. Then it turned into 2 games and grandma said she would. We live 1000 miles away from her and only see her a couple times a year, so she buys him stuff whenever she gets the chance. She does not go overboard, but still likes to buy him stuff. But then he said he wanted 3 games and I stepped in and said no. I don't think she would have agreed to buy him 3 but I wanted to make sure she did not say yes.

So my question is, How do I teach him that games or anything costs money, that he can't have everything he wants right then? How do I show him how much money it would cost to him this game he wants?

I don't always give him what he wants right when he asks for it but usually within a week or two I will get it for him.

What can I do next?

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answers from Joplin on

At 3 1/2 you are not really needing to worry that he has no concept of money. Of course he has no concept of money .... he's 3 !! LOL !!
I don't think that was your problem concerning this particular phone call, though. He asked for a game and Grandma said "yes." He asked for two games and Grandma said "Yes." At his age, it is simply cause and effect. Testing to see where the boundries are. He just wanted to see how many games he could ask for before Grandma said "No."

You did exactly the right thing. You stepped in and stopped it when he had reached what you felt was a good limit. At his age, he needs and wants limits, and that is what parents do. They are here to help with those limits until we are able to set our own limits.
You didn't say anything about him being upset at not getting a third game, so that tells me you are already successfully teaching him to accept limits whether you realize it or not.

You can start now with a simple penny system to teach him about money if you like.
Decide on a few simple chores he can do. Even a three year old can put away his toys, or let the dog out when needed, or even sweep the kitchen floor. Be creative.
Next get a jar that will be his money jar.
Set a definite amount of pennies that will be earned each time he completes a task.
Also, get a few small items that he can eventually "buy" with his pennies. When he asks for the item of choice, help him to count out the pennies for it. If he does not have enough, tell him what he could do to earn more pennies. Then when he is disappointed because there are no more pennies in the jar, you have the perfect opportunity to explain to him that everything costs money, and money must be earned.

This should NEVER be tied to Grandma's or anyone else's gifts, however. Gifts are just that ..... gifts. And gifts are not earned.

Don't expect more of him than he can understand. Even older children who have a good grasp on the value of a dollar still think Grandma is made of money and it will never run out. My kids did it to my parents, and my grandkids do it to me. It's our own fault for being so generous with them, but hey, that's the perks of earning your Grandma stripes.

Rather than worry about his understanding of Grandma's limited money supply, you might have better success at this point simply teaching him that it is not polite to ask for things. We can earn things we want, or be very appreciative if someone gives us something nice, but it is not nice to ask for gifts.

One other quick thing ......
You said that you do not always buy what he wants right away, but that you do eventually buy it. This may be teaching him to have patience, which is good, but it is still teaching him that eventually he gets everything he thinks he wants.
When my kids asked for something that was not a necessity and beyond their ability to earn, I wrote down what they asked for and taped it to the fridge. If, after one month, they were still wanting that item as much as in the beginning, and if it was within my ability to obtain, I would get it for them.
More often than not, the desired object was no longer desired. I saved the money, and they learned that even though you want something desperately in the moment, that doesn't mean that you REALLY want it. It is just a passing thing. They learned to think about their wants and that sometimes we don't really need or even want an item as much as we think we do in the moment.

I wish you well, and I think you are doing a better job already than you think you are.

3 moms found this helpful


answers from Wichita on

I had to chuckle at your post because I'm a long distance grandma and I think you handled it just right. You didn't take away from grandma the pleasure of doing something for him and yet you put limits on it.

You could let you son earn a little money and have him buy grandma a gift and send it to her. Trust me, it would melt her heart.

1 mom found this helpful


answers from Kansas City on

I will be very interested in hearing what the other mommies have to say. I do not think you can actually teach a 3-year old the value of money! The maturity isn't there. But you can teach a 3-year old that ONE is better than NONE. I think you already get it that giving in to this sort of behavior will create a greedy little guy! Next time, try saying, "you can have ONE or you can have NONE. Which do you choose?"

You probably also have to ask your mom not to agree to more and more - instead, to offer him non-material things - like "I will mail you kisses" or to send him pictures of her and the rest of your family so he can have their likenesses to look at. She could say, "I can only send ONE toy, but I could also send a picture." Or a letter, or kisses, or a drawing or whatever.

Good luck!

1 mom found this helpful


answers from St. Louis on

Your primary issue isn't teaching your 3 yo the value of money. That's tough. Your issue isn't him asking for stuff. That's what 3 yo do. Your issue is teaching him that the answer can't always be yes. He can't have things everytime he asks for them. He can't have your time everytime he has a whim. He can't do what he wants to do at the drop of a dime. He needs to learned to be patient.

1 mom found this helpful


answers from Columbia on

Wow, this is all very familiar. I have a very outgoing almost 5 year old that I am still trying to teach that to.
He picked up quickly who would by things for him, and is not shy at all about asking. The first few times I was HORRIFIED. At the same time the people he was asking never seemed to mind. I tried talking to him and explaining "we don't ask for toys". Anyway, in the long run, it's really not a big deal, and he is way to young to learn the "value", because it will be a while for him to even understant our money system. My son is just now starting to understand that if you have 4 quarters you do NOT have enough money for a power ranger. But even that is with much heated discussion, and convincing on my part.
Good luck



answers from Lawrence on

My girls, ages 3 and 5, get $2.00 a week. They both like to save it. My oldest has bought herself a watch so far. My 3 year old is still saving. They both want to save for Disney world because I've told them its expensive. (We have no plans to go, I've just told them that someday we will.) Its been about 4 months that we've done this, and they are both starting to understand. If they want something while we're at the store, I usually tell them they can buy it with their own money. We go home and count their money, and usually they decide its not worth it. If they don't have enough for it then I tell them how many weeks it will take to save enough. Thats how we got the watch. I think its really good to start at a young age. My oldest has been asking about credit cards and I've tried to explain debt to her, which I'm not sure she gets. She just knows that people can get into trouble with credit cards and not ever have money. The only way to really teach about money is for them to be able to have it and decide for themselves to spend it or save it. Start now. Its a good age for it.



answers from St. Louis on

We just talked about this subject in my Sunday School class! Even at a young age you can give kids money for doing "chores" (rather than giving them an allowance without doing anything to earn it). Some things they have to do just for the sake of helping, others they do to get paid. It's all about teaching the value of working, and it's rewards. Use a clear container to keep their money in, and if you pay in dollar bills, crumple them up when you drop them in (looks like more!). After a certain point, your son can take his money and spend/give/save. Make a chart of his (age-appropriate) chores and post it where he can see it. Then at the end of the week, he gets paid for the things that he did. Then he will learn that money is finite. It still doesn't fix a spoiling grandma, but maybe when he gets older he will appreciate the value of a dollar a little more!



answers from St. Louis on

He is opld enough at 3 1/2 to begin "working" there are things he can do around the house tohelp you-like picking up his toys every day for a fee, helping his sister and things that he does on a daily schedule. Do this by using a chart with marks he understands -every day take a few minutes after he has done what he is supposed to do and apply the marks to the chart-then at a select time each week have something ready play money,coins, plastic markers and place them in a jar where he can see but not necessarily touch. Early on you and he set a goal for this (somethig small but he will pay for it by "working"). Start out on a short time as he is still young and will give-up or lose interest easily then at the said time you will count the amout and take real money to purchase the item. If it is food then make sure he cannot eat it till he comes home and makes note of this on his chart so he can look back later to see where his money has gone. Also you can do this with a non-food item so when he forgets what he bought you can show him where you both wrote it. This is also good for teaching him how to organize his time and when he is in school later how to keep up with his homework and time allotment for all he will do. Good luck and have fun and be patient he is still little so you may be repeating yourself quite often. Grams are allowed to spoil but you can keep the amount in your protection and have a closet for some of the toys and things so he is not overwhelmed by EVERYTHING at once. It will all have more meaning later and when you do take something ot-then put something else away for awhile.



answers from St. Louis on

You know, maybe using a coupon system at home could work. Obviously counting out real money and coins and stuff isn't very easy right now, but maybe if you got a few pieces of contruction paper or just loose leaf, cut them into little rectangles, and decorated the rectangles with dollar signs. Give him an allotment of "dollars" each day, and have him "pay" for things. Like, 2 dollars for breakfast, 1 dollar for a juice box at snack, 1 dollar to play a video game, etc. The first day, he sill most likely run out by 2 pm, but if you don't intervene and let him learn the lesson, he will most likely be more dilligent later. So, if he asks for something later and it isn't financially a good time, or simply isn't a need at all, you can refer back to that day he didn't have enough money to have a cookie upgrade at snack time, and mommy doesn't have it right now either. Maybe another day. You will just really need to be dilligent! That is usually the hardest thing with us parents. The kids are ready to learn the lesson, we just have to be strong enough to teach it. Good luck!!



answers from Kansas City on

Dave Ramsey has a really awesome program/system that teaches kids about money. It comes in a big pack- I think it includes some books and pretend money, etc. I wish I could tell you more, but while I was at his conference this weekend I saw it and wanted to get it for when my daughter turns 3. You may look into it...

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