Raising money smart kids begins with teaching how money is earned. Start small by letting them know the different ways they could be paid.
April is Youth Financial Literacy Month and to celebrate we’re sharing resources and activities you can use to help guide the children in your life. Below is a video to watch together, article to read, questions to discuss, and links to a related comic and activity sheet.
People earn an income when they’re hired by an employer to work at a job. Income is earned as a wage, a salary, or a sales commission.
Let’s look at an example of each:
Andrew works as a waiter at the Pancake Hut. He earns a wage, which is a set amount of money per hour of work. Andrew’s wage is $10 per hour.
Ellie works as a scientist and earns a salary. A salary is a set amount of money per year. Ellie’s salary is $50,000 per year. If she adds up all her paychecks this year, the total will equal $50,000.
Toby works as a real estate agent earning a sales commission. A sales commission is an amount of money based on part of a sale amount. Tony is helping a family sell their house and in return, they agree to pay him 5% of the house’s sale price. Tony sells the house for $200,000. The family pays him $10,000, which is 5% of the $200,000 sale.
Questions To Discuss
List three different ways an employer can pay you for working at a job.
What’s the difference between a wage and a salary?
A ________________ is income based on part of a sale amount.
What would Andrew have to do to earn more money at his job? What would Toby have to do?
Bonus Question: A wage, a salary, and a sales commission are all ways to earn income at a job. What’s another way to earn income?
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