I'm broke!

Teach your child the value of a dollar

A child learns about money every day. Even without discussing it, parents are teaching children about money. Children learn from the way parents spend, the way they save, the way they indulge children, and the way they deny requests.

Even quite young children see money being paid at stores, for services, on television, and at other places and to other people.

It takes time for them to understand the connection between money and other things. Even children with considerable exposure to shopping may not understand the connection between money and goods changing hands.

Be a good sport!

In fact, until about age seven, most children don't comprehend that making a purchase involves an exchange of equal value for goods received. They still don't understand how money is obtained or that there is not an endless supply of it. Many children believe that when more money is needed, a parent can simply go to the bank and withdraw the needed funds.

The final stage of a young child's understanding of money is learning that it is earned by working.

The basic idea, then, is to help a child understand that money is earned, that we have a limited quantity to spend, and that we must make choices about how that money is spent.

Here are some general principles and specific activities:

• Allow a child to make limited choices in as many situations as possible. Four-year-old Lisa wants to buy a birthday present. Instead of selecting the gift, Lisa's mother picked out three possible choices and let Lisa select one, thus creating a limited choice for Lisa.

• Don't make money frightening. Instead of saying constantly that a desired item is not affordable, stress the notion of having enough money for items A, B, or C.

• Don't make money transactions solely an adult activity. Let a child hold money and ask questions about it.

Who's the boss at grandma's?

Let children be involved in monetary transactions as often as possible. For instance, if your toddler is always asking for treats at the store, try giving her a set amount to spend. Let her know once it is spent, there will be no more. Then let her decide how to spend it.

It's also important to remember that preschoolers may sound like they know more about money than they really do. They may be able to count, but that doesn't necessarily mean they understand numbers.