How to Teach Your Toddlers to Work, Earn Money, and Become Frugal

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Children thrive in environments where they learn to help, have skills to do things, and feel like they contribute. Children should be taught the concept of earning something through work at a young age. I have been learning by experience how to teach toddlers to work, earn money, and become frugal.

My daughter, Aurora, is two years old and my son, Denali, is four. They have been earning money for over a year now.

I pay them a quarter when they accomplish any one of the following tasks: folding all the towels, folding and hanging their laundry (they do most of their own laundry themselves) which includes loading it into the washer, pushing the buttons and switching it over—with my assistance.

They also earn quarters by unloading the dishes and putting them away and loading the dishwasher. Other tasks include weeding the garden, organizing, and cleaning.

During our home renovation they’ve earned quarters by helping me sweep, pull up carpet staples, pack and unpack, wash down cabinets, put things away, vacuum (with a shop vac), and more.

Just the other day they helped me put together these storage containers we have. They held the poles while I connected them loosely with the screws, then they used a screwdriver to tighten them (I tightened them securely when they were done).

They have helped me clean out a major mess in our office and even set up their play room library.

I’m seriously so proud of the work ethic they are developing as well as the skills and the helpful attitude they have.

This is in addition to normal chores that I do not pay them for: making their bed, picking up their room, setting and clearing the table, and doing their preschool curriculum. They only earn quarters for special jobs that take at least an hour or more to accomplish. 

One of the reasons I do this is because my kids are always asking me for something they want. For example, a few months ago my son kept asking me if he could go to Chuck e Cheese’s. I told him he would have to earn the money. My daughter wanted to go too. I paid them a quarter for each couple of hours they helped me pack boxes to move, clean, and do other chores. Since they had already been saving previously it only took a month to earn enough for us to go to Chuck e Cheese’s. They enjoyed it so much more knowing they earned the money for it. 

After Chuck e Cheese’s we moved to our new house and my son was begging me to go to the Loveland Planet Aquarium. His sister joined in. I looked it up and couldn’t believe it was $15.00 for a child. But I did find out that Aurora was still free. I said, “Mom will pay for herself and Aurora is free, if you two earn enough in quarters, you can buy a ticket to the Aquarium for Denali.” They agreed.

They began asking everyday for special jobs to earn quarters. They worked very hard pulling weeds, unpacking, doing laundry, and loading and unloading dishes. A few months later they had earned $11.00. My friend gave me a free ticket and was going with my kid’s friends. Since my $25.00 ticket was free, I decided that my kids should go even though they were a few dollars short. I made up the difference.

Yes, I admit to padding their piggy banks with an extra $3.50 each so I could save $25.00 on my ticket and attend with friends—but it was well worth it. When they realized they had earned enough money to attend the aquarium they were ecstatic!

Note- If you did the math, you will have realized that I padded their banks with an extra $1.50 because they have to earn 10% more than what they need to buy something with because we have a family rule that you must pay 10% to tithing/charity before you can use your money. 

They paid their tithing and then I cashed in their quarters for dollars. When we arrived, they got to pay the cashier with their own earned money. They were so proud. I noticed they enjoyed the aquarium a lot more having worked for it and wanted to stay longer, which I allowed.

The next week, we were at a store and my son was really wanting a dice game he saw on the shelf. It was $12.00. I knew it would take him a very long time to earn $12.00 on his own but I told him once he earned it we would come back and buy it. He started earning his quarters for the dice game.

After earning about $3.00 we were at the splash pad when a boy drove by on a 3 wheeled scooter. Denali was mesmerized. He was so so excited and couldn’t stop talking about a scooter! I told him he could earn money for a scooter or the dice game. He choose the scooter and he was over the moon with excitement.

Weeks later, after lots of special jobs and chores, he and his sister had earned $7.00 and $7.50 respectively. I began looking on line and realized that the scooters he was looking at were $30.00+ each! Yikes. I felt terrible, until I decided we’d get them second hand. I started calling consignment and thrift stores: Kid to Kid, Deseret Industries, etc.

We found a pink 3 wheeled scooter at Kid to Kid for $6.50 that Aurora bought. A few days later we found a red 3 wheeled scooter at Deseret Industries thrift store for $6.00 for him. Both times I had my children hand the money over to the cashier so they knew it was them that bought it. 

Whenever anyone comments about their scooters they both proudly said, “We earned these”. I always smile pretty big at their pride and sense of accomplishment. 

Currently, they are earning their biggest buy yet: a hammock swing. They want to hang it up in their room. This is one of the longest stints of time between earning and redeeming that they have gone as they both have to earn about $15.00 but they can and will do it. They are determined. 

A few things I’ve learned from doing this:

1- Pay a little more than you think is appropriate.

Some may say that paying a 2 year old .25 cents for folding a big bin of towels is too much, but I think that they need to see how money adds up and what it can buy. If I was paying a nickel it would take too long for them to earn items that mean a lot to them.

2- Encourage your kids to choose—both the job and the reward.

In the discipline/parenting course Love and Logic they stress parents give their kids choices. I try to always let my kids choose what they can do to earn a quarter. Do you want to fold towels or fold all the clothes? Do you want to unload or load the dishwasher?

After they earn one quarter, if there is more work to do, I try to make the second quarter optional. Usually one will choose to do it and the other not. For example, after they were done folding about 30 towels (small and big) I said okay if you want to earn another quarter you can help me weed the garden or you can just play while mommy does it and not earn a quarter. My son choose to help, my daughter to play. Sometimes my daughter wants to earn more and my son doesn’t. I like to give them an option if they’ve already worked a lot that day. 

3- Do not buy the item (with their knowledge) until they’ve earned it (or most of it).

My sister talks about how she was unknowingly teaching her kids the ‘buy now, pay later’ flawed financial philosophy in our book Living a Rich Life as a Stay-at-Home Mom: How to Build a Secure Financial Foundation for You and Your Children. She would buy the item and allow her kids to pay for it when they got home or she would even keep it and have them work it off after they got home.

She came to find that her kids started buying things they really didn’t want when she did this. When she realized they were having the buy now, pay later attitude, she stopped and made her kids wait till they had earned the money and actually buy the items in person with their own cash from then on.

She said it was surprising to see how much more conservative and picky they were about what they spent their earned money on. Since hearing this, I have also instituted a policy that they must pay for items cash in hand themselves (unless I can find a better deal online) but then they will pay me the cash as I hand over the item. 

4- Take them shopping at thrift stores, dollar stores, and use coupons.

My kids would have worked months for their scooters and missed summer altogether had we not found them 75% off at thrift and consignment stores. When I took my kids to Chuck e Cheese’s we researched and found a coupon that saved them $10.00 on tokens/points. Its important to help your kids learn that money stretches a LOT further if they are thrifty and frugal and utilize coupons.

The Dinosaur Museum has a few $5.00 days (which is $10.00 of child admission). Tuesdays at the movie theaters near us admission is $5.00 instead of $10.00 and popcorn $1.00 instead of $6.00. By taking your children on days where their money buys so much more it teaches them the power of thrift, earning, and also motivates them to continue to work.

5- Teach them how to work.

Most people would think a 2 year old was not capable of doing her own laundry and folding the house dish rags and towels. Most probably think little kids can’t weed a garden, pull up carpet staples or wash down kitchen cabinets and clean out drawers. I’m here to say they can do it and they love to do it. They don’t always love working but once they get going they do enjoy interacting with me, working hard, earning and working for something they want, and feeling empowered. 

Not only does this system teach children to work, earn, save, become thrifty, and self sufficient, it makes them excited or at least happy to help out around the house. Plus, I don’t have to be a bad guy every time we are at the store and they ask me for something. I just say. You can get it after you earn enough for it.

I’m very grateful for the opportunity to teach my children and to work right along side them. They are my joy and light of my life. It makes me happy and excited that they are becoming such hard yet enthusiastic workers.

I hope these tips help you as you teach your children to work, earn, and become self sufficient.

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