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Introducing My 5-Year-Old to the World of Finances

Updated: May 13, 2022

"Mommy, what are you doing?"

"Creating an inspiration board for you."

Who knew that board would soon rock my little boy's world as he finally understood the power of money.

My sister had gifted him a book and a bank last Christmas. These items introduced the idea of GIVE, SAVE, SPEND. Since then, I have switched the bank he got to a clear jar that is hard to open (so little hands don't throw coins everywhere) and counts the coins as you put them in like this one. Once the jar is full we will take it to a coin machine for cash then divide that money into the appropriate categories. Clear jars (recommended by Dave Ramsey) allow the kids to get excited about seeing their money grow.


To reinforce the idea of saving, my mom started a savings account at her bank. We took him there and had him bring his money to deposit himself. We also created a notebook for him to record how much is in his account. The older he gets, we will introduce investing and compound interest. I also recently got into basic coin collecting myself and think it will be a creative way for kids to be more mindful about money when they get older. You have to hold each coin in your hand, examine it, and appreciate it for its true value (did you know pennies made pre 1982 were made with more copper thus being worth 2.5 cents? Talk about more than doubling your investment!).


This is where things have gotten really interesting. I wanted to find a way to teach my little one how to be smart with the way he spends money. I grew up in thrift stores (and still do most of my shopping in them). There is so much value to shopping in a thrift store but I also want my kid to not get into buying things just because they are cheap and he can have them now. I want him to be able to think about the one thing (toy) that brings him joy and work towards getting that no matter how much work it takes.

Recently, I have been creating a Pinterest board as a way to discover my style these days. I feel a bit lost and am getting into the idea of a minimal, curated closet. This gave me the idea to show Hux how to create an inspiration board! Now I love this idea and plan to use magazines or a printer to make a cool collage in the future but we didn't even get that far this time.

Seriously, this is as far as we got till he freaked out.

Day 1: I started drawing pictures of a few things he has been talking about wanting.

I started explaining how we've been talking about getting a new bike and explained how much it would cost. I then asked him about the crane truck he keeps asking about. "You mean I can get a crane truck!?!"

"Yeah, totally," I responded. "Under two conditions: you can pay for it and you make room in your toy room for it (meaning get rid of a toy)".


....Welcome the next two days of madness.

I showed him how to search on Amazon for crane trucks and let him shop. I showed him where the prices are marked. Now, one mistake I made was showing him too early how higher numbers meant it would take longer to get the toy. After trying to find a toy that he could get right away, I directed him back to thinking about what he really always wanted )his FAVORITE!) and not to worry about the costs. After almost a whole day of shopping and yelling at me for the toy, he found the one he wanted. $17.49 it would cost him. We then went to his spending wallet. He has $11 and we counted on our fingers how much more money he needed to make. I explained he can work for money in a few different ways:

Paid chores. Now I failed to pre-plan for this project. I had no idea I was opening Pandora's Box. I didn't have a clear idea of what chores I would pay him to do. My mom saved me and offered to pay him $.10 for every weed he pulled. My dad gave him $1 to water the yard and I offered $1 to vacuum a mess I made (totally overpaid him I know).

At this point he is getting really frustrated he can't have the toy NOW. Between yelling at me and shopping online, I started to lose my mind and my wonderful RIE parenting was going out the window. "It's time for a break son".

Day 2:

"Mom! Is my toy here!?"

"No dude, you haven't made enough money yet."

Making room for his new toy!

He wasn't making money fast enough. So I introduced another way to make money by selling stuff. We recently had a garage sale (he also learned about running a business with his lemonade stand) so he has been watching all the grown-ups purging and making money in the process. We went through his room and outdoor toys and purged. He got rid of a third of what he had HAPPILY.

I showed him how I post his toys on Facebook Marketplace and within the following days, he saw as people came to buy his stuff. I would then make him put some of his money in his SAVE bank and he could keep the rest. At this point, I showed him how to shop on Marketplace for his crane truck in hopes we get lucky and find it cheaper. He ended up finding a log-loader-crane truck on the Marketplace for $4. So we set out that day to buy it. We had him count his four one-dollar bills on the table and finished the whole experience off with a "pleasure doing business".

I can breath now! He was so excited and proud of his truck.

Since then we have been reinforcing our money lessons. He is willing to watch educational videos he didn't before like these:

Where does Milk come from? My son liked this although we don't drink cow's milk and I wasn't a fan of the lady mentioning mommies give candy for being good. We just joked about it and moved on.

Coins Here is a catchy song teaching about coins.

Shop! Here is a fun game to go shopping and then count your money after.


Give will be the next project. In a few months, we will be exploring different charities where he can decide where to send the money. Instead of me telling him what to do, I want to see if he can get passionate about a certain charity and well go from there.

If anyone has tips on how to get my kid to learn about different charities, send them my way!

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