Unless taught, children have no concept of the value of money, other than hearing parents say: "We don't have enough money," or "That's too expensive". These comments leave children wondering why their parents don't have enough money, why can't they just get some more, and what exactly does 'expensive' mean?

Here's a fun way to teach children the value of money:

Cut green construction paper into the rectangular shapes of paper money. Put a large $1.00 value on each. Give each child 20 of these. Next, show the children some small items they can purchase at $2 each with their money (such as a fancy pencil, a joke or coloring book, pack of crayons, etc).

After the children have made their purchases, bring out some higher value items to purchase at $4 or $6 each (such as a piece of jewelry, sunglasses, glow in the dark shoelaces, etc). After the children complete this round of purchases, award $1.00 to each child who still has at least $10.00. Explain how by saving their money in a bank account, their money can grow.

At this point, some children may want to return purchases so they will be eligible for the $1.00 bonus. Explain to them that you do not want the items, but you are willing to refund them half the amount they paid for each item. Or, they can talk other children into buying their purchases from them, at whatever amount they can get even if it's more than what they had paid.

After that round of refunds/reselling, bring in another batch of goodies for the children to purchase at a rate of $6 or $8 each.

Next, award an additional $1.00 bonus to each child who still has a minimum of $10.

Take a tally of how much money each child has, and assign tasks according to the chart below:

Children with $22 (No task)
Children with $20-21 (a 5 minute task)
Children with $16-$19 (a 10 minute task)
Children with $10-$15 (a 20 minute task)
Children with $5-$9 (a 30 minute task)
Children with $0-$4 (a 40 minute task)

Make sure the tasks equal the value of money each child spent.

The tasks are to repay the money they were advanced and had spent. The reason the tasks are performed at this stage versus prior to receiving/spending the money, is to emphasize the value of money. By performing the tasks afterwards, it will be more memorable and the concept of money's value will be more firmly embedded into each child's mind. Children who spent the most money will see how the children who had spent less didn't have to work as much, and vice versa.

In one week, repeat this lesson.

This free tip was provided courtesy of Credit Federal. For more financial tips, visit CreditFederal.com/article.