How Money Came To Be - A FUN Story For Kids
There is a good chance your child or teen has never even thought about how money came to be. Teaching your child or teen about the history of money can help them understand the basis of economics as well as cultivate an appreciation for the truly remarkable times we are now living in and the opportunities that they have.
Let’s start at the very beginning with an overview about the history of money.
In The Beginning…
Tens of thousands of years ago there was the time of cave dwellers and women but no money.
Imagine this for a moment… money does not exist! No dollars or Euros or credit or debit cards. No banks or bank accounts and no shops.
Your child might wonder, ‘How did people even survive?’
The concept seems so foreign to us, it really can be difficult to wrap our heads around this, but this is how life was at one point in time.
So How Did It Work? Let’s have a look …
Self Sufficiency
To begin with, we were self-sufficient. What does this mean? It means just like today our ancestors had the same basic needs like food and drink, clothing and shelter. But instead of buying these with money, which didn’t exist, they went out and acquired each item by themselves.
They hunted for food, or picked it from trees, they milked cows; they used the hides of animals for clothes and footwear and they built homes from trees or moved into caves.
However, over time people’s skills became more specialised. Some people focused on herding cattle, others focussed on making clothing, while others focussed on building shelters and homes.
People focused on doing the things they preferred, rather than trying to do everything.
Bartering Systems
Eventually a system of bartering was introduced so that people could swap one service for another. For example, a farmer who grew apples would barter with another farmer who grew bananas, and in this case apples would be swapped for bananas.
Over time, as you might imagine, it became difficult to know what exact worth each item had. How many apples was enough to exchange for some bananas? Because of this, a different type of exchange was necessary to show the value of goods.
Coins & Notes
The result of bartering was that certain items we used were easier to exchange and became used as a currency rather than directly swapping products. Items such as feathers, precious stones, metals like gold and copper, jewellery, salt and even flowers were used as types of money. Over time, approximately 3,000 years ago, these items became coins. After more time, paper notes started to be used.
Further Reading
Credit & Debit Cards
This system of coins and notes has lasted for thousands of years and of course is still in use today. About 30 years ago plastic cards, credit and debit cards, have to a great extent, taken the place of coin and paper money and can are used in both stores and for online purchases.
Further Reading
An Introduction to Credit Cards for Kids and Teens
Online Money Transfer
In today’s world, money can be exchanged online without anything physical being exchanged at all. Money can now move at the speed of light. You can transfer money to a friend on the other side of the world in a millisecond.
Money is nothing more than a means of exchange.
Cryptocurrency
Today cryptocurrency such as Bitcoin have arrived. This is a brand new concept for exchanging money.
Like anything new, Cryptocurrency can be at first a little tricky to understand. If you are not sure what cryptocurrency is or how it works, check out this check out this 3 minute video, ‘What is Cryptocurrency? A Simple Explanation’ by Blockgeeks.
Summing Up
It is such an exciting time to be alive and learning about money. With rapid changes occurring in global economic systems, it can sometimes be overwhelming! However, learning about these changes and keeping up with how they will affect us in the future is important for your child or teens’ future financial success.
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