Why do people have to pay for things with money?

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In order to live, all people need basic things like food, clothing, and shelter. To have these things, grown-ups must work jobs so they can buy the things they need, and sometimes also the things they want!

Money is a system for trading (bartering) between people so we can all get the things we need and want. Say, for example, that a farmer needs some bricks to build his house. To get the bricks, he can trade what he has (vegetables) with what the mason has (bricks). However, if the mason only needs fruit and not vegetables, then the farmer can’t get his bricks! He’d have to try to trade his veggies with the owner of the apple orchard, and then trade the apples to the mason for his bricks.

Instead of trading and trading over and over again until they can get what they want or need, people use money, which is something everyone deems valuable and worthy of accepting for a trade!

To try and keep the system fair, people have to earn money by working hard at their job! That way, everyone who has a job can get something back for all of the hard work they do! And when we pay for things with money, we’re rewarding the people who worked hard with the money they have earned!

Piggy Bank!

Do you have any money of your own? Some kids receive a little bit of an allowance, like a few coins or a few dollars, to save or spend in order to help them learn about money.

Sometimes kids and their parents decide that in exchange for some extra help around the house, the kids can earn a little bit of money!

Think about this: If you receive one dollar every Friday for helping around the house, you can buy something that costs one dollar on that very day! But, if you keep the dollar in a safe place and wait until you receive another dollar the next Friday, then you can buy something that might be nicer for two dollars instead! This is what happens when you save your money. -- COOL!