Financial literacy activity
Taxes: Our Community Piggy Bank
Pool play coins into a 'community jar' with your family — then 'buy' something everyone gets to share, like the park or library!
Materials and setup
- play money
- jar for community funds
- paper
- pencil
- calculator
How this changes by age
Pre-K (ages 3–4)
Pool play coins into a 'community jar' with your family — then 'buy' something everyone gets to share, like the park or library!
Steps
- Give each family member 10 play coins. Everyone drops 2 coins into a 'community jar.'
- Talk about shared things: the park, the road, the library. Everyone uses them — and the community jar pays for them!
- With the community jar money, 'buy' a shared item: a toy that EVERYONE gets to play with (a ball, a puzzle).
- Discuss: if nobody paid, there would be no parks, no fire trucks, no roads!
- Draw a picture of your favorite community thing that taxes help pay for.
Learning objectives
- Understand that taxes pay for shared community resources
- Practice contributing to a communal fund
- Identify community goods funded by taxes
Kindergarten (ages 5–6)
Explore how taxes work: everyone contributes a share, and the government uses it for schools, roads, police, and parks. Decide as a group how to spend tax money.
Steps
- Set up a 'community': each family member earns play money for doing a task. Everyone puts 20% into the 'tax jar.'
- Count the tax jar total. Now the community needs to decide: build a new playground OR fix the road? Vote!
- Discuss: there's never enough money for everything. The government has to make tough choices too.
- Learn about sales tax: at the store, the price is $10 but you pay $11. The extra $1 is tax.
- Make a list of 5 things taxes pay for and rank them by importance.
Learning objectives
- Understand the concept of paying a percentage in taxes
- Practice democratic decision-making about community spending
- Recognize that tax revenue is limited and requires prioritization
Early elementary (ages 6–8)
Study how taxes work in the real world: income tax, sales tax, property tax. Understand how government budgets are created and where tax money goes.
Steps
- Learn 3 types of taxes: income tax (percentage of what you earn), sales tax (added when you buy something), property tax (based on your home's value).
- Calculate sales tax: if tax is 8%, how much tax do you pay on a $25 item? What's the total?
- Study where tax money goes: create a pie chart showing approximate federal spending: defense, healthcare, Social Security, education, infrastructure, interest on debt.
- Simulate tax filing: earn pretend income, calculate 15% tax, subtract deductions (school supplies, charitable giving), and determine tax owed.
- Debate: the community has $100 to spend. Divide it among: schools ($?), roads ($?), parks ($?), police ($?), library ($?). Justify your allocations.
- Write about: what would happen if no one paid taxes? What public services would disappear?
Learning objectives
- Calculate sales tax and simple income tax
- Analyze government budget allocations
- Debate public spending priorities with reasoning
Upper elementary (ages 8–10)
Read a real paycheck stub, decode every line, and find out what your state actually spends tax money on. Then form an opinion backed by real numbers.
Steps
- Look at a real paycheck stub (parent can show you theirs with the dollar amounts hidden if needed). Identify: gross pay, federal tax withheld, state tax, Social Security, net pay (take-home).
- Calculate: what percentage of gross pay was withheld?
- Now research: what does your state actually spend tax money on? (Pull up your state's budget online — most states publish a pie chart.)
- Write 3 sentences: One thing your taxes pay for that you support. One thing you don't. One thing you'd like to know more about.
- This is what civic engagement looks like.
Learning objectives
- Read a paycheck stub and identify gross pay, withholdings, and net pay
- Calculate the effective withholding percentage on real wages
- Form an evidence-based opinion about state tax spending priorities
Safety and evidence note
Read the full activity before beginning. An adult should supervise tools, heat, food, outdoor work, movement, and experiments as appropriate. Completion records that the activity was done; the child’s explanation, work sample, photo, or demonstration is stronger evidence of learning than a completion check alone.
Related financial literacy activities
Build a Brand
Create a name and a colorful logo for your pretend business! Draw it big and bold. Pick your business colors and make a sign to hang up.
Career Day Explorer
Explore different jobs! Learn about what people do to earn money. Dress up and pretend to be a doctor, teacher, firefighter, or chef. Every job helps our community!
Charitable Giving Hearts
Find 3 toys you've outgrown and put them in a donation bag for another child. Sharing makes someone else happy AND feels good in your own heart!
Coin Sorting
Sort coins by type and learn their names! Practice identifying pennies, nickels, dimes, and quarters by color, size, and pictures.