Financial literacy activity
Earn, Tax, and Keep
Earn pennies for a chore, then learn what 'tax' feels like when one of them goes to a community jar.
Materials and setup
- chore list
- real or play money
- tracking sheet
How this changes by age
Pre-K (ages 3–4)
Earn pennies for a chore, then learn what 'tax' feels like when one of them goes to a community jar.
Steps
- Earn 5 pennies for a chore.
- Give 1 penny to a 'community jar.'
- Keep 4 pennies.
- Notice: you have less than you started with after the tax!
Learning objectives
- Earn money by completing a chore
- Experience giving up a portion as 'tax'
- Compare what was earned to what was kept
Kindergarten (ages 5–6)
Three weeks of chores. Earn $1 per chore, and after every $5 earned a parent collects $1 as 'tax.' Track the whole thing in a chart.
Steps
- Plan 3 weeks of chores. Earn $1 per chore.
- After every $5 earned, parent collects $1 as 'tax.'
- Track in a chart: chores done, money earned, tax collected.
- After 3 weeks, count what you kept vs what got taxed.
- Talk about what the tax money will be used for.
Learning objectives
- Track earnings and taxes over multiple weeks
- Compare gross earnings to take-home amount
- Understand a simple flat tax
Early elementary (ages 6–8)
Three weeks of real work. Parent withholds 20% of every paycheck as 'tax.' Track gross, withheld, and net pay each week, then vote together on what to do with the tax fund.
Steps
- Spend 3 weeks earning real money for chores or odd jobs.
- Parent withholds 20% as 'tax' each week.
- Track gross pay, tax withheld, and net pay each week.
- At the end, vote as a family on what to do with the 'tax fund' (donate to charity, family outing, family project).
- Reflect on how 20% withholding changed what you took home.
Learning objectives
- Calculate gross pay, tax withheld, and net pay over multiple weeks
- Understand percentage-based withholding
- Practice collective decision-making about pooled tax money
Upper elementary (ages 8–10)
Same setup as early elementary, but with 25% withholding to feel real adult tax rates. Calculate your effective tax rate and reflect on the trade-off between paying tax and getting public goods.
Steps
- Spend 3 weeks earning real money for chores or odd jobs.
- Parent withholds 25% as 'tax' each week (closer to real adult tax rates).
- Track gross pay, tax withheld, and net pay each week. Calculate your effective tax rate.
- Discuss: how does it feel to lose 25% of every paycheck? What public goods does that money pay for in the real world (roads, schools, fire department)? Was it worth it?
- Write a 1-paragraph reflection.
Learning objectives
- Calculate effective tax rate from withheld and gross pay
- Connect personal withholding to real public goods funded by tax
- Write a reasoned reflection on the cost and value of taxation
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.
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