Module 2: Understanding Income and Different Ways to Earn Money

FINANCIAL LITERACY LEARNING RESOURCES 

Understanding Income and Different Ways to Earn Money

1. What is Income?

Income is the money that people receive in exchange for doing something. It can come from different places. People use income to buy things they need and want, like food, clothes, toys, or savings.

2. Where Does Income Come From?

There are many ways people can earn income, and kids can start learning about them early on. Let’s explore three main ways:

A. Jobs

A job is something someone does to get paid. There are different kinds of jobs, and people usually work at their jobs every day. For example:

• Teachers get paid for teaching kids at school.

• Doctors earn money by helping sick people feel better.

• Bakers make bread, cakes, and other treats to sell.

When kids grow up, they can choose a job they like to earn their income. Jobs can be working for a company or even starting something of your own!

B. Allowances

Sometimes, kids can earn money at home from their parents or guardians by doing chores. This is called an allowance. Examples of chores could include:

• Cleaning your room

• Helping with dishes

• Taking care of a pet

This is one way to learn responsibility while earning money at the same time. Allowances help kids learn about money by letting them save up for things they want.

C. Entrepreneurship (Starting a Business)

Entrepreneurship is when someone creates their own business. It means finding something you’re good at or enjoy doing and finding a way to earn money from it. Examples for kids could include:

• Lemonade Stand: You make lemonade and sell it to neighbors.

• Selling Crafts: If you love drawing or making bracelets, you could sell your creations.

• Dog Walking or Babysitting: Helping neighbors take care of their pets or younger kids.

By starting a small business, kids can learn what it feels like to create something valuable and be paid for it.

3. How to Choose What Works for You?

It’s important to think about what you enjoy doing and how you can earn money in a way that makes you happy. For example:

• If you love helping people, maybe you’ll enjoy jobs like teaching or caregiving.

• If you enjoy being creative, you could earn income by making and selling art or crafts.

• If you like solving problems, you might like running a small business, where you think of new ideas to help others.

4. Why is it Important to Earn Money?

Earning money helps people take care of their needs (like food and shelter) and wants (like toys or video games). It also helps you learn how to save and spend wisely.

Activity:Ask kids to think about ways they can start earning money at home. Can they do chores for an allowance? Is there a small business idea they can try? Let them share their ideas with the class.

By the end of this lesson, kids should have a basic understanding of where money comes from and how they can start earning it in small ways now or in the future.