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Interesting Money Facts for Kids

People have been buying and selling things for thousands of years. To conduct this business, something had to be used to make payments. In the beginning, people did not use coins and bills for money. Instead, they used other objects, such as stones, shells, or beads. First, coins were created, and then, paper money was invented to help people trade for the things they needed.

Bartering was a method of trading services and items between people so they could get items. With bartering, people simply traded something they had for a different item that someone else had. This arrangement often worked well so people could get things they needed, trading things like furs for meat or grain. There were limitations to the usefulness of bartering, though. If no one needed grain, then the farmer who had grain to barter might not have been able to arrange a trade to get something else he needed. For this reason, people needed something to trade that everyone wanted and needed that would have value.

People created money to use for trading. Money would have value, which meant that everyone would want and need it to trade it for the other things they needed. China was the first country to begin using metal for money, and they made coins out of copper and bronze. Making small metal coins made sense because the coins would fit easily into pockets or bags and people could carry the coins with them. Metal coins were also strong, and they would last for a long time.

As coins evolved, they needed to have more value so people could use them to buy more expensive things. So people made coins out of precious metals like gold and silver. They also began stamping coins with special designs to show that the coins were real money that people should accept. Eventually, the idea caught on, and different countries made their own special coins as a part of their own currency systems. Governments also began backing the value of coins. This means that a country's government guaranteed that a coin would be worth a certain amount. People could use and accept coins knowing that their government was promising that the coins would have a specific value.

Carrying coins around might have been difficult for people who had a lot of them because they could be heavy. Early on, people in China began writing notes on paper to take the place of giving people coins. Paper was easier to carry and transfer than coins, but paper notes did not have the same value as coins did. Governments stepped in to guarantee the value of paper notes. Paper money gained popularity slowly, and eventually, it spread throughout Europe as different countries realized how easy it was to trade with paper instead of coins.

The United States became an independent nation in 1776. Before the United States became a nation, people had to use other currencies to buy things, including English, Spanish, and French money. Paul Revere was a blacksmith, and he was involved with the design and production of the first coins for the new country. The U.S. Congress passed the Mint Act in 1792, which was the beginning of the nation's new currency system using coins and dollars. The first United States coins were minted in 1793 at the Philadelphia Mint. Paper money began circulating in the United States in 1861. In 1864, Congress gave permission for currency to have the motto "In God We Trust" printed on it. All U.S. coins and paper money still have this motto printed on them today.

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