A survey by the American Institute of CPAs found that the average allowance of $780 a year provides kids with enough money to buy an Apple iPad and three Kindles—with money to spare for even more spending, seeing as only 1% of parents say their children save any of their allowance.
Effective money management hinges on adopting the right habits—and it’s important for parents to instill good ones at a young age. Of course, knowing not only when to begin teaching money smarts to kids but also where and how can be a challenge.
That’s why we rounded up a few of our favorite educational tools that are tailor-made for instilling in children of all ages lessons about saving, money management and even entrepreneurship. Then we asked Darrah Brustein, author of “Money-Making Sunny: Finance Whiz Kids” to weigh in on why they’re worth the investment.
Skills It Teaches: Saving
This smart piggybank, which lights up in celebration every time that a deposit is made, connects to a smartphone app that totals the change from afar—engaging young children in the seemingly boring topic of saving through positive reinforcement.
What the Expert Thinks: It’s also a great way to encourage setting and tracking financial goals, Brustein says. Let your little one pop in the coins, and watch the numbers add up!
Cost: $7.95 per month
Skills It Teaches: Counting and other basic math
This award-winning site can familiarize children as young as 2 with such simple math concepts as counting and the principles of “more” and “less” through games, puzzles and other tools—ultimately setting the stage for someday teaching multiplication, algebra and geometry.
What the Expert Thinks: “[ABCMouse.com] is a great example of ‘edu-tainment’ at work,” Brustein says. “It offers a wide variety of lessons, but the math skills, in particular, will be great building blocks for kids as they learn about different financial concepts.”