Teaching Tool of the Month: One Cent, Two Cent, Old Cent New Cent
Every month we are highlighting one teaching tool that has our stamp of approval in helping parents or grown ups put the FUN in teaching the fundamentals of finance.
We independently research, test, review and recommend the best products—for FAQs about us click here. If you buy something through our links, we may earn a commission.
Book: One Cent, Two Cent, Old Cent, New Cent
Author: Bonnie Worth
Age Range: 3 years old to 8 years old
This month we highlight a book from Dr. Seuss as a great way to get the kiddos interested in how money works. Most of us have read a Cat in the Hat book or two growing up, taking kids on adventures with classic stories and whimsical rhymes that can boost the imagination.
When it comes to understanding money, One Cent, Two Cent, Old Cent New Cent is one we would recommend including as you start to teach the kiddos about things like money identification or how we use money for different purposes. Now, in addition to some of the more simple lessons we can take from the book, we also touch on a few points below that you can use to start to help the kiddos grasp the most important money concept of all: using money as a tool to live the life you want.
As we note when we highlight any teaching tool, don’t worry if everything we talk about below doesn’t sink in right away; these lessons take time for our kids so patience and repetition are key.
Ok, so lets dive in and talk about some important principles and lessons that can be learned from the book.
Money Identification
Perfect for first or second graders (maybe even kindergarteners if your kid id ready), One Cent, Two Cent, Old Cent, New Cent can teach the valuable lesson of being able to identify different types of money.
The book’s focus towards the end on US coins and bills is a great place to start to weave in some history (why do our coins look like that?) along with identifying the value of each coin or bill. The rhyming is clever and the illustrations are wonderful allowing for the kiddos to start to ask us some questions around why different types of money is the way it is and start to think about value.
We would reccomend that when you read the book have some coins or bills handy in order to show the kids what they look like in real life, as this will allow them to associate the story with money that they see every day. We would also note that this can be a great start to get them interested in further coin and bill counting or money identifying (if you are looking for some good pintables we have some here).
The last point here is that we can start to talk to them about different currencies and how each country uses there own money as the story does a nice job of laying out the history behind this. The more they see and interact with money in real life after reading this story, the more it will sink in and the more interested in money they may become!
The Exchange of Value
We talk about this concept in more depth in our inaugural, phycologist review course, Nurturing Financially Mindful Kids, but the book does a wonderful job explaining to kids the true use of money: as an exchange of value.
It touches on the history of why money was invented (trading honey for wheat needed to change!) and highlights this key point to the kiddos early even if they don’t fully recognize it. While our kids have seen money exchange hands and may grasp the high-level idea that we need money to pay for things, what we really want to teach them is that money is a symbol of value that we use to exchange for something else that has value to us.
As we teach our children to conceptualize how money is used as an exchange of value, we also want to instill in them a more empowering (vs. emotional) association with money. As we get older, we have many emotions tied to money -- teaching our kids to think logically about how money is used as a symbol of value in an exchange can help them feel more in control of their finances as they get older. This is also the first step in teaching them what we at Future Funders believe is the true purpose of money: to serve as a tool to help shape the lives we want to live. Not the life society tells us to live...not the lives our friends are living...not the life our parents think we should live...but the life we truly want for ourselves.
The Cat in the Hat highlights this point (knowingly or not) as the book goes through talking about how money is exchanged and can be a great starting point to discuss this concept with the kids. We can build on this book by teaching our children that they have to give up something of value to get something of value. Maybe when we are out at the store we can reference the book and show them how we are giving up value (money) to buy some milk (for example). Once our kids start to grasp this concept of exchange of value they can then start to think about the truly important question when it comes to money: what has value to them.
What A Bank Does
We would hesitate to go into too much detail here at a young age (unless you think your kids are ready), but the book does highlight the basic concept of a bank and how people use it to store value.
This concept can be brought to life the next time you visit a bank by bringing the kids. Talk to the teller or a bank employee and have him or her explain what the bank does to your children. Relate whatever they say back to the book and this may be an early way to get them interested in how the broader financial system works. As they get older it is very important for them to understand the broader financial system and how to use it to their advantage (something else we are not taught in school!) and Dr. Seuss is a superb way to start to pique their curiosity.
What is Interest and Savings
In addition to the concept of a bank, we would also note that this book can be a jumping off point to start to talk about the concept of interest and saving their money. We would all like our kids to learn to save money and have a little patience (or deferred gratification - one of the most important money concepts of all) and we can use Dr. Seuss to get the conversation started.
If your child is already earning an allowance, one way to encourage this behavior and also teach them the concept of interest is by implementing the concept of “The Parent Bank.”
The Parent Bank is owned and operated by parents or grown ups and offers interest on any allowance that the child leaves with it for a specified period of time (i.e. without spending it.). The interest rate you offer to your kids does not have to mirror real life (for example if they leave $2 with you for two weeks you can tell them they will earn and extra $1) but it will start to teach them about deferred gratification and saving their money vs. spending.
As they grow we would note we should build on this concept by introducing the concept of investing (one of the three ways to consistently earn money) but with this book we can start to mold the behavior that will lay the foundation for smart behavior with money.
