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Friday, November 21, 2008

What Can You Teach A One Year Old About Finance?

For a one year old who can barely speak, how can I share with him the knowledge that I'm gaining slowly nowadays about the financial world? My first challenge would be to make him understand what I'm trying to tell him. Then, the next challenge would be to get a response from him. But still, I'm just so eager to transfer him all that I've learnt.

Ok, I have to start somewhere. Maybe not on the compounding interest mentioned by Frugal Dad in How to Teach Compounding Interest to Kids or even the difference in needs and wants as mentioned by JLP in his post : Using Mashed Potatoes To Teach Kids About Money. Those are great ideas, but I'll think I'll save it till my boy is a little older.

For a start, I've decided to teach him that he needs to save money. So, how do I do that? My little boy has a habit of digging into my shirt pocket every day when I return from work, usually throwing off my pen and petrol receipts in the process. So, this time, I had on purpose, some coins in my pocket. Everyday, without fail, we dig into my pocket and discover those coins. And what do we do with that? We head for the elephant-shaped 'piggy-bank' and drop the coins into it. Initially, I was putting in the money. As he grew to hold the coins properly in his fist, I have trained him to 'bank in his savings'.

What do you think he would have learnt in the process? I'm sure he doesn't know what is compounding interest or the difference between needs and wants. Heck, I doubt he even understands what money is at the moment. But I'm very pretty sure he knows that the shiny round thing from his dad's pocket must end up in his 'piggy-bank'. That's sufficient for now, I think, don't you agree?

We have been religiously doing this activity for about 3 weeks now. The only concern is I have to be very careful and pay full attention to him as kids tend to put anything they find into their mouth. Otherwise, I think I have put him on a head-start on financial education!

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Anonymous said...

May not seem very practical but then if it is working with you,very good.Atleast till he understands what money can do,he will keep putting it in the piggy bank.
Once he comes to know it can buy those candies,then god only helps:-)
But a creative thought,no doubt

t-luck said...

buddy, what do you expect with a 1 year old? :)

Yes, agreed with you. 'Once he knows he can buy candies with those things...' :)