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Money Management Lesson for Kids

Instructor: Ashley Smith

Ashley has taught elementary school and has a Master's Degree in Elementary Education.

Do you have dreams of being rich? Learning how to manage your money now can help you make that dream a reality. Read this lesson to learn how to manage your money!

What Would You Do with $10?

Taylor and Avery are sisters. They both worked hard raking leaves for their Grandma. As a reward for their hard work, their Grandma paid each of them $10.00! Right away, Taylor took her money and put it in her savings jar. She is saving her money to buy a brand new tablet! Now, Avery asked her Grandma to take her to the local supermarket where she spent her money on chocolate candy and a small toy. What would you do? Would you save the money or buy something right away? Here is what you need to know about saving, budgeting, and spending.

Saving

When you save money, you put it aside for another time. Maybe you have a piggy bank, special jar, or even a wallet where you put your money. Many people also have a savings account at the bank. Savings accounts can be great because you actually earn extra money called interest! Interest is money that is added to your account every so often. The amount of interest that each account receives is a percentage of the current account's balance. So, you get extra money just for letting your money sit at the bank! Like Taylor, you can save your money and add to it over time. Perhaps you have something in mind that you want to spend it on, like Taylor who wants a tablet. Or maybe you just to save your money for whatever the future may bring!

Putting money aside for another time is called saving.
money

Budgeting

A plan for your money, including the money that you spend and save, is called a budget. If you get an allowance, you can come up with a budget for it. Say you want to be able to buy some candy and a comic book every month, but you also want to save some money. You need to figure up how much money you make a month and determine how much you want to save. The money left over is what you have to spend on candy and a comic book. A budget helps you take care of your money and use it wisely.

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