How to Explain Money to Third Graders

Money is the most naturally motivating math topic.

Kids want to know: How much do I have? Can I afford this? How much will I get back? These questions make learning money concepts irresistible.

Coin Review: Building Fluency

Before tackling third-grade money problems, make sure coin values are automatic.

The Four Coins

Coin	Value	Key Feature
Penny	1¢	Copper color, Lincoln
Nickel	5¢	Larger, silver, Jefferson
Dime	10¢	Smallest, silver, Roosevelt
Quarter	25¢	Largest, silver, Washington

The Confusing Part

The dime is worth MORE than the nickel, even though it's SMALLER. This trips kids up. Practice until it's automatic.

Skip Counting Practice

• Count by 25s: 25, 50, 75, 100, 125...
• Count by 10s: 10, 20, 30, 40...
• Count by 5s: 5, 10, 15, 20, 25...

These patterns make counting coins efficient.

Counting Mixed Coins

The Strategy: Largest to Smallest

Problem: Count this money: 3 quarters, 2 dimes, 1 nickel, 4 pennies

Step 1: Sort by value (quarters → dimes → nickels → pennies)

Step 2: Count quarters first

• 25, 50, 75 (that's 75¢)

Step 3: Add dimes

• 75, 85, 95 (now at 95¢)

Step 4: Add nickels

• 95, 100 (now $1.00)

Step 5: Add pennies

• 100, 101, 102, 103, 104 (total: $1.04)

Why This Works

Starting with the largest values minimizes the number of "jumps" and makes the counting easier to track.

Practice: The Daily Count

Empty out a jar of coins. Sort, count, record. Do this regularly until it's automatic.

Dollars and Cents Together

Understanding Notation

$4.75 means:

• 4 dollars (the whole number part)
• 75 cents (the decimal part)

The decimal point separates dollars from cents. Everything to the right of the decimal represents less than one dollar.

Reading Money Amounts

Written	Said
$3.50	Three dollars and fifty cents
$0.85	Eighty-five cents
$12.04	Twelve dollars and four cents
$7.00	Seven dollars

Notice: We say "and" where the decimal point is.

Adding Money

Works just like adding decimals—line up the decimal points:

  $3.45
+ $2.78
-------
  $6.23

Remind students: Two digits always appear after the decimal point for money.

Subtracting Money

Problem: You have $10.00. You spend $6.35. How much is left?

  $10.00
-  $6.35
--------
   $3.65

This requires regrouping with decimals—practice is essential.

Making Change

This real-world skill is crucial. There are two methods:

Method 1: Subtraction

Cost: $3.75
Paid: $5.00
Change: $5.00 - $3.75 = $1.25

This works but requires decimal subtraction skills.

Method 2: Counting Up

Cost: $3.75
Paid: $5.00

Count up from $3.75 to $5.00:

• $3.75 + 25¢ = $4.00 (add a quarter)
• $4.00 + $1.00 = $5.00 (add a dollar)
• Total added: 25¢ + $1.00 = $1.25

Why Counting Up Works

This is how cashiers often make change. You're finding how much more you need to reach the payment amount.

Practice Scenarios

• "The toy costs $4.50. You pay $5.00. What's your change?"
• "Lunch is $6.85. You give $10.00. How much do you get back?"
• "The book is $8.25. You pay with a $20 bill. What's the change?"

Multi-Step Money Problems

Third graders solve word problems involving multiple operations.

Addition Problems

"You buy a sandwich for $4.50 and a drink for $1.75. How much did you spend?"

$4.50 + $1.75 = $6.25

Subtraction Problems

"You have $15.00. After buying a book, you have $8.35 left. How much was the book?"

$15.00 - $8.35 = $6.65

Multi-Step Problems

"You have $20.00. You buy a shirt for $12.50 and socks for $3.25. How much do you have left?"

Step 1: Total spent = $12.50 + $3.25 = $15.75
Step 2: Money left = $20.00 - $15.75 = $4.25

Estimation with Money

Before calculating, estimate:

"About how much is $4.89 + $3.15?"

• $4.89 is about $5.00
• $3.15 is about $3.00
• Estimate: about $8.00

This helps catch errors (if you get $18.04, something went wrong!).

Common Mistakes (And How to Fix Them)

Mistake 1: Coin Value Confusion

Error: Thinking a nickel is 10¢ or a dime is 5¢.

Fix: Regular handling of real coins. Quiz games: "Hold up the coin worth 10 cents."

Mistake 2: Decimal Place Errors

Error: Writing $1.5 for one dollar fifty cents.

Fix: Always use two digits after the decimal for money. $1.50, not $1.5.

Mistake 3: Counting Errors with Mixed Coins

Error: Losing track while switching between skip-counting amounts.

Fix: Sort first. Count one denomination at a time. Write down running totals.

Mistake 4: Subtraction Without Regrouping

Error: $5.00 - $2.75 = $3.75 (just subtracted 2 from 5, ignored the cents)

Fix: Line up decimals. Practice regrouping with money specifically.

Real-World Practice Activities

Store Play

Set up a store with price tags. Practice:

• Counting out exact amounts
• Making change
• Calculating totals for multiple items

Allowance Math

If your child receives allowance:

• "You have $5.00. This toy costs $3.49. Can you afford it? How much would you have left?"

Restaurant Menu Math

Look at a menu (real or made up):

• "Order two items. What's the total?"
• "You have $15. What can you afford?"

Grocery Shopping

At the store:

• "About how much for these three items?"
• "We have $20 for snacks. How much more can we add?"

Coin Jar Goals

"You want to buy a $15 game. You have $8.75. How much more do you need?"

Money Vocabulary

Make sure your child knows:

• Cent (¢): One hundredth of a dollar
• Dollar ($): Basic unit of U.S. currency
• Decimal point: Separates dollars from cents
• Change: Money returned when you pay more than the cost
• Exact amount: Paying with no change needed

Connecting to Place Value

Money reinforces place value:

$4.75 = 4 dollars + 7 dimes + 5 pennies
= 4 ones + 7 tenths + 5 hundredths

The dime is 1/10 of a dollar. The penny is 1/100 of a dollar.

This connection prepares students for decimal work in later grades.

Building Financial Literacy

Money math is more than calculation. Discuss:

Saving

"If you save $2.00 each week, how much will you have in 4 weeks?"

Spending Choices

"You have $10.00. You could buy one $9.00 item or three $3.00 items. What would you choose and why?"

Comparing Prices

"Store A sells it for $5.99. Store B sells it for $6.25. Which is cheaper? By how much?"

The Bottom Line

Money math is practical, motivating, and reinforces multiple skills:

• Place value (dollars, dimes, pennies = ones, tenths, hundredths)
• Addition and subtraction with regrouping
• Skip counting
• Real-world problem solving

When your third grader can count a pile of coins, calculate the total cost of purchases, and figure out their change—they're using math the way adults use it daily.

And that's the whole point.