6 Tips For Setting Your Preschooler Up For Financial Success

Ad failed to load

If you’re the parent of a preschooler, you’re probably focused on teaching your kid the basics: The alphabet, sharing, why we don’t put food up our noses. But should those first lessons include tips for setting your preschooler up for financial success? The answer is “yes,” according to New York Times bestselling author Beth Kobliner, whose new book Make Your Kid a Money Genius (Even If You’re Not): A Parents’ Guide For Kids 3 to 23 hits stores Feb. 7.

A 2013 study from Cambridge University found that for most children, basic money habits are formed by the age of 7, and a separate study from the University of Wisconsin-Madison showed that even preschoolers can grasp simple money concepts like exchange and value, so it makes sense that we should take advantage of these formative years to pass on as much financial savvy as possible. But the truth is, many of us are hesitant to talk to our kids about money, whether it’s because we don’t feel qualified to dispense advice, or because we’ve internalized the idea that discussing these matters with children is somehow taboo. “And that’s a problem, since research shows that parents are the number one influence on our children’s financial behavior," Kobliner wrote. "So having these conversations before our children start school is important.”

Of course, those conversations should be simple and age-appropriate. You’re not going to talk to your 3-year-old about the stock market, but that doesn’t mean you can’t introduce them to the concept of investing — even if you don’t know all that much about the topic yourself. Here's how you can make sure those conversations are getting your little ones started off on the right foot, economically speaking.

Ad failed to load

1Use Simple Visuals To Demonstrate Money’s Value

Maria Manco/Offset

Even at the age of 3, kids are old enough to understand that money is more than just something in mommy’s purse. “One tried-and-true technique is to find three jars and have your child label one to save up for things to buy in the future, one to buy stuff right now, and one to share with other people who need help,” Kobliner wrote. How much gets saved isn’t important — just make sure that your child puts money away on a consistent basis, whether it’s birthday money from a grandparent or even change he found buried in the couch cushions.

2Show Them That Hard Work Pays Off

Johanna Hood/Offset

You probably tell your kid that you go to work so you can earn money, but small children don't necessarily make that connection. "Though you might tell your kid that you are paid to work ... it's more effective if you can show them," Kobliner said. If you can take your child to work with you one day, that’s a great way to demonstrate the concept; if that’s not possible, take her by your workplace during off hours so she can visualize what it is you do all day and where. Then, at home, show her that everybody has a “job” to do by enlisting her help with small household chores like putting away her shoes or helping to sort the recycling. She may not complete each task perfectly, but she will start developing a work ethic.

3Explain That Everything You Buy Costs Money, Even If You’re Using A Credit Card

Caven Images/Offset

It’s not uncommon for preschoolers to think that when you use your card to pay for things at the store, they’re somehow “free” — which, as you know, is not the case. Your child might still be too young to understand interest rates and credit scores, but she still needs to know that paying for something with credit still costs money. Kobliner suggests this exercise: When you’re at the store, tell your kid to pick out a small-ticket item around the one dollar mark. Next, take out four quarters, a dollar bill, and a credit card, and explain that you can use any of those methods to pay.

Ad failed to load

4Teach Them The Difference Between “Want” And “Need”

Jennifer Bogle/Offset

The distinction between actually needing something and just really, really wanting it can be almost impossible for little kids to understand — but being able to make that all-important call is crucial to learning how to spend wisely. To get the point across (and avoid screaming fits in the checkout aisle), Kobliner suggests walking the aisles of a store with your child, pointing at certain items, and asking them, "Want? Or need?" Let him throw the "needs" in the cart, and leave the wants on the shelf.

5Help Them Understand That Investing In Their Future Is Important

Elizabeth Ordonez/Offset

OK, so maybe your kid is a bit young for a trip to Wall Street. You can still teach them about the concept of investing by relating it to something concrete and easy to understand, like by planting a seed in a flowerpot. “Talk about the time it takes the plant to grow, and the fertilizer and water that you need to ‘invest’ in it so that you get the payoff of a beautiful sunflower or a ripe tomato at the end,” Kobliner wrote.

6Teach Them That Sometimes You Have To Wait For Things You Really Want

Boone Rodriguez/Offset

Whether it’s a pair of expensive shoes or a big-ticket item like a new car, we spend much of our adult lives working and saving up to buy the things we dream of owning. Help your child to develop patience by pointing out the benefits of waiting: Remind her that soon, it’ll be her turn on the swing, or that the car ride will end and you’ll be at the zoo soon. “It’s also good to talk about waiting for far-off goals such as a birthday or a holiday, and how great it is when the day finally arrives,” Kobliner wrote. “To help pass the time, you can discuss what will happen at the birthday party, who will attend, what games you’ll play, and what the theme will be.”

Ad failed to load

This post is sponsored by Make Your Kid A Money Genius (Even If You're Not) by Beth Kobliner.

Ad failed to load
Must Reads

15 Baby Names With Unique Nicknames, So Your Family Has Options

I love a good diminutive name, also known as a nickname. I believe I’m partial to them because of my own name, Abigale, but I go by Abi. And since they’re both uniquely spelled, everyone thinks my name is pronounced Ah-bee for some reason — but even …
By Abi Berwager Schreier

The Entire Family Can Enjoy These Movies & Shows Coming To Netflix In June

It's just one of those sad facts of life: every month, shows and movies vanish from Netflix, their varied excitements no longer at your fingertips. But luckily the streaming service is always prepared to fill that content void with lots of new things…
By Megan Walsh

The Reason Why Babies Smile At You Will Seriously Make You Smile

Whether you're currently the recipient of your own baby's sweet smiles or you just seem to be a magnet for baby grins in general, you might find yourself wondering why babies are always smiling at you. Sure, you could be a 'smile whisperer' but scien…
By Kate Miller

8 Ways Your Baby Is Trying To Say That, Yes, You Are Their Favorite

For a baby to show a preference for a specific person is not only normal, but an essential part of their development. Babies need to form strong attachments to their caregivers for their emotional, social, and physical wellbeing. Usually, but not alw…
By Kimmie Fink

10 Reasons Why I Won't Apologize For Giving My Toddler A Pacifier

My first child had no interest in a pacifier. I tried a couple times to get him to take one, but he always spat them out and gave me an incredulous, judgmental look. But my second? It was love at first suckle. And after a while, the incredulous, judg…
By Jamie Kenney

Being A Dog Parent Prepared Me For Having A Baby, Really

I’ve always wanted kids; I was never as sure about raising a puppy. Then I spent six months living with someone who brought home an eight-week-old golden retriever puppy, and I see no way to make it out of that experience claiming not to love dogs. I…
By Heather Caplan

20 Of The Most Popular Unisex Names Of All Time, That You'll Be Hearing More Of For Sure

You might think of unisex names as a fairly recent trend, but the truth is these versatile monikers have been commonly used throughout history (well, some more commonly than others). That's why the team over at Names.org recently compiled a list of t…
By Jacqueline Burt Cote

How To Have A Date Night With No Babysitter, Because It's Easier Than You Think

After having children, many couples feel that their love lives immediately go out the window, but it's so important to make your romantic life a priority so both you and your partner can be the best versions of yourselves you can be. As we all know, …
By Abi Berwager Schreier

9 Ways Baby No. 3 Made My Family Feel Complete

My husband and I decided to have another baby right after we got married and, well, we had no idea what we were getting into. I got pregnant right away, endured a high-risk pregnancy, and, before I knew it, my third baby had arrived. Together, we emb…
By Steph Montgomery

8 Stereotypes About New Dads That Are *Totally* True

Much like new mothers, new fathers have a lot on their plate. Parenting can be scary and complex, especially at first and regardless of your gender. People want to do right by their kids, after all. And since all new parents are a hot mess, dads are …
By Priscilla Blossom

8 Differences Between Being Pregnant In Your 20s Vs 30s, According To Science

Whether you're planning a pregnancy, or just thinking about your future family, it's typical to think about things like child-spacing, how many kids you want, and when to start trying to conceive. When making your pro/con list, you might also conside…
By Steph Montgomery

16 Moms Share Remedies For Their Most Intense Chocolate Cravings During Pregnancy

For better or worse, pregnancy is usually synonymous with odd cravings. Sure, there are the stereotypical combos like pickles and ice cream that plague gestating women the world over, but there are other mind-boggling combinations, too, including but…
By Candace Ganger

Putting Sunscreen On Your Kid Doesn't Have To Be A Fight — Here's How To Do It

I am almost translucent, so me and sunscreen are basically besties at this point. Even though my children are beautifully deep brown thanks to my husband's genetics, I still slather them like biscuits being buttered because I refuse to take risks wit…
By Cat Bowen

19 Moms Share The Way They Cured Their Pregnancy Comfort Food Cravings

I was obnoxiously sick during the first trimester with, "lucky" for me, both of my pregnancies. For the first three months I lived on saltines, lemonade, and fresh bread. Once I was able to eat, however, all I wanted was savory and sweet comfort food…
By Dina Leygerman

I Used To Judge Formula-Feeding Moms — Until I Became One

The other patrons in the hip Brooklyn restaurant probably couldn’t care less what I was feeding my baby, but I’ll always remember the shame I felt as I quickly mixed up his bottle of formula in front of them. I admitted to my childless friend that I …
By Katherine Martinelli

7 White Lies It’s Necessary To Tell To Keep Your Relationship Healthy

Telling lots of lies typically isn't associated with a healthy, strong, lasting relationship, and that's still certainly true, but not all lies are exactly the same. Though you've probably heard from someone at least once or twice that the lie they t…
By Lauren Schumacker

The Skinny Jeans That Saved Me Postpartum

Accepting my post-pregnancy body is hands-down one of the most difficult things I’ve ever done. It’s something that I still work on every single day. During my first pregnancy, I was 20 years old, so I managed to bounce back quickly. In fact, I dropp…
By Allison Cooper

7 Ways Your Baby Is Trying To Say They Feel Safe

In those first weeks of new motherhood, it can feel like you need an interpreter for your newborn. With their limited means of communication, figuring out what message your baby is trying to get across to you can be a challenge. With time, however, y…
By Kimmie Fink

Here's Why Dogs Are Obsessed With Babies' Poop, According To Science

Most family dogs seem to understand babies, and they're more than happy to make friends with the newest member of the pack. It's adorable... for the most part and until you go to change your little one's diaper. Suddenly, you're wondering why dogs ar…
By Lindsay E. Mack

6 Signs You're Meant To Have A Big Age Gap Between Kids

There's a five year age difference between my two children, to the day. Their age gap wasn't planned but, for a variety of reasons, works well for our family. And since I was so focused on having a second baby, I totally overlooked the signs that wou…
By Candace Ganger

My Dog Knew I Was Pregnant Before My Family Did

Growing up, I was 100 percent sure I'd be a mom one day. To a dog, that is. My baby plans came later. And once my husband and I were sure we wanted both a dog and a baby, we'd add to our joint dog-and-baby name list over Sunday brunch or on date nigh…
By Melissa Mills