Inflation is a big word, and a pretty complex concept, too. But, with help, kids can understand what it means and see how money can actually lose value over time and prices generally go up over time. Smart saving doesn’t only mean setting money aside; it means thinking about how inflation could affect it in the long term
Kids might be surprise to learn that the value of a dollar changes! And so does purchasing power. The reason for this is inflation, which is influenced by market power, demand and supply. Print The Value of Money or have kids read online to learn more.
Over time, things will cost more than they used to. That’s because of inflation. Show kids this chart to see how prices rise and why they’ll have to save more than they might expect in order to reach their future goals.