History of Money Lesson for Kids

Instructor: David Wilson

David has taught college history and holds an MA in history.

People use money in everyday life rather than trade for what they need. In this lesson, learn about how societies created money from precious metals, then transitioned into using paper cash, and finally today's electronic purchases.

Let's Trade

When was the last time you bought a candy bar or a can of soda? Imagine if money didn't exist and you had to trade for a snack instead of buying it with dollars. You'd have to find out what the store owner wanted, like gasoline for their car or a new jacket, then find a way to trade for those items as well. Our money serves as a replacement so that nobody has to trade for what they want. In the U.S., we use dollars and cents for our money.

The use of money dates back thousands of years. About 3,000 years ago, China developed the use of miniature metals as a system of trade. At first, they created small symbols out of bronze, a mix of copper and tin metal. For instance, you could trade a bronze symbol of a shovel for a real shovel. Eventually their symbols became circles, creating the first coins.

Ancient Chinese coins
Ancient Chinese coins

Silver and Gold

Around 2,500 years ago, other places outside of China began creating coins out of precious metals. Some of the first silver and gold coins in history appeared in Turkey and Greece around 500 BC. Since silver and gold are both rare, these coins had a lot of value. Only the richest persons living in the ancient world would have had gold coins. Kings stamped their faces on coins so that everyone would know the coin was not a counterfeit, meaning a fake. The first values of coins were also set down. For instance, we know that a Greek silver 'obol' coin could buy a loaf of bread, while a nice pair of shoes would cost about ten larger 'drachma' coins.

Silver coin from Roman Empire
Roman silver coin

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