We’re fast becoming a cashless society. Many of us pay for our shopping with debit and credit cards and check our balance on our mobile phone. While it’s quick and easy for us, it can be tricky for children to understand that we’re spending real money.
How do I teach my child about digital money?
It’s worth taking the time to explain how digital money works, so your child, even if they’re very young, understand that you’re not getting things for free when you make a cashless payment.
Show them how digital money works
You can start by explaining the basics, such as:
- digital money means paying for things without using cash
- you can use your phone, card, or watch to make payments
- your phone has an app that connects to your bank account and show them
- cards take money from your bank account using a card reader (show them next time you use contactless)
- your bank account is where you keep your money
- use an app to move money between accounts and pay for things you buy online.
Using a gift voucher online
Gift cards have a fixed amount of money, so they’re a useful way to help children understand that once the money is spent, it’s gone.
Spend a gift card together
- talk about how to spend their money
- decide whether they want to spend all their money at once or save some
- show them the balance on the gift card
- explain how much would be left after they pay
- use an online checkout by entering the card details.
Get money out of a cash machine
Next time you draw cash out from a cash machine, talk your child through what happens.
At the cash machine
Next time you use a cash machine:
- explain how you keep your PIN number safe and why you don’t tell anyone your number
- tell your child how much you’re getting out and show them the notes
- get a receipt so they can see your balance go down.