Financial literacy is an essential life skill, yet many adults struggle with money management because they never learned the basics as kids. Traditional financial education often focuses on abstract concepts that can be difficult for children to grasp. That’s where play-based learning comes in! According to research at the Harvard Graduate School Of Education:
Learning is helped by "experiences that are playful — that are joyful, meaningful, actively engaging, iterative, and socially interactive.”
By incorporating money lessons into games, pretend play and real-life micro-businesses, kids can develop financial confidence in a fun and engaging way.
In this article, I’ll explore the importance of play-based learning for financial literacy, how it helps kids understand key money concepts and practical ways parents and educators can incorporate it into everyday life.
Why Play-Based Learning for Financial Literacy
The Growing Need for Financial Education for Younger Kids
With increasing student loan debt, poor budgeting habits, and rising costs of living, financial literacy is more crucial than ever. Research shows that financial habits are formed as early as age seven. Teaching kids about money early helps them build habits, setting them up for future success.
The Role of Play-Based in Learning For Kids
Children naturally learn through play. Whether pretending to run a store, setting up a lemonade stand, or playing board games involving money, these activities help reinforce financial concepts in a hands-on way. Play engages children emotionally and cognitively, making learning more effective.
According to experts, when playful learning is embraced in schools, students are given opportunities to:
Explore the unknown and develop curiosity and deeper meaning in their learning.
Lead their own learning by making choices, taking ownership, and feeling empowered.
Find joy in learning through experiences that spark enjoyment and delight
Play-based learning is impactful because it empowers students to take charge of their own learning, making choices and exploring concepts in ways that are meaningful to them. It fosters a culture of collaboration, where kids learn together, share ideas, and develop important social skills.
Through play, children are encouraged to take risks, experiment with different strategies, and learn from both successes and mistakes—essential skills for real-world problem-solving. Imaginative thinking is at the heart of play, helping kids develop creativity and resourcefulness as they navigate financial concepts.
Most importantly, play allows children to experience a range of emotions—excitement, frustration, joy, and determination—teaching them resilience and emotional intelligence in the process.
How Play-Based Learning Builds Financial Literacy Skills
1. Understanding the Value of Money
With the increased use of debit and credit cards, combined with digital payments, kids rarely see physical money, making it harder for them to develop a tangible understanding of its value and how it’s earned, saved, and spent. Through play, they can touch money (real & pretend), experience how it’s earned and how to spend it.
Pretend Play: Example - a pretend grocery store at home allows kids to exchange items for value (painted rocks, pennies, play money, etc.)
Kid Businesses: Example - activities like lemonade stands or bake sales teach kids how money is earned in a fun and engaging way.
2. Learning How to Budget
Budgeting is a crucial skill that can be taught through simple play-based activities.
Books About Budgeting: Each book in The Little Books Of Big Business series teaches kids how to separate money into five categories: Savings, Personal Fund, Donations, Business Fund & Long-Term Savings
Envelope or Jar System: Give kids play money or use real money (or earn it) and let them divide it into different jars or envelopes for spending, saving, and giving.
Board Games: Monopoly and The Game of Life introduce budgeting through games.
3. The Power of Saving
Saving money requires discipline, but play can make it easier to grasp.
Savings Jars: Create labeled jars for different goals like Cat, Emma, Max & Nick in The Little Books Of Big Business
Specialty Savings: Play "Holiday In July" by giving kids an envelope:
Kids make a list of people that they plan to give a gift to in December
Write down a gift idea for each person & the cost
Color the envelope with holiday images
Total up the price of all the items.
Find ways to earn money NOW so you can save up money to spend in a few months!
4. Making Smart Spending Decisions
Teaching kids how to spend wisely helps them differentiate between needs and wants. Make it fun and experiential!
Price Comparisons: Have kids “shop” for toys online or in-store while comparing prices and making choices within a budget.
Delayed Gratification Games: Use challenges like “Wait a Week” where kids must wait to buy an item to see if they still want it.
5. Encourage Kids to Start Their Own Business
One of the most engaging ways for kids to learn about money is by earning it themselves. Help your child start a micro-business that fits their interests and abilities. The business doesn't need to last forever. Much is learned during a two-hour lemonade stand or caring for a pet for a weekend. Some small business ideas for kids include:
Lemonade, shaved ice or bake sale stands – A classic way to learn about costs, pricing, and profits. (Get inspired by Cat Casey Turns Brownies Into A Business)
Yard work – Mowing, raking leaves and shoveling snow are just a few services kids can offer.
Farmers market pop-ups – Selling handmade crafts or homegrown produce. (Get inspired by Tim Young Turns Clouds Into Coins)
Starting a small business helps kids understand the value of money, the effort required to earn it, and the importance of managing it wisely.
These "micro-businesses" give them fun ways to build soft skills like creativity, communication, strategic thinking, collaboration and problem-solving.
Encourage them to keep track of their earnings and expenses to introduce the basics of budgeting (All The Little Books Of Big Business books teach kids how to budget their earnings.)
6. Use Play-Based Activity Sheets to Reinforce Learning
A structured way to teach financial literacy is through play-based activity sheets. Let’s Play Money offers engaging printable worksheets designed for kids from preschool to sixth grade. They are full of crossword puzzles, money math worksheets, money news, games and coloring. These activities integrate essential financial literacy standards including:
Earning & Income
Spending & Saving
Financial Psychology
Risk & Insurance
Credit & Debit
These worksheets make learning about money fun and interactive. Kids can color, cut, and complete challenges reinforcing key financial lessons. Making these activities a regular part of their routine helps build long-term financial confidence.
Start Early and Stay Consistent
The best time to start teaching kids about money is when they are young and eager to learn. Kids develop a natural understanding of money management when financial lessons are paired with their interests—whether through books, play, coaching, business ventures, or activity sheets. By making these lessons a regular part of their childhood, they gain the skills to make wise financial choices as they grow.
Teaching kids about money isn’t a one-time lesson—it’s an ongoing journey. Start today with these five easy steps, and watch your child develop the confidence and knowledge to manage their finances for a lifetime.
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