Students use a place-value chart and physically take away tokens that represent ones, tens, hundreds, thousands, ten-thousands, and hundred-thousands. When there are not enough tokens in a place to subtract, an “exchange” and “regrouping” occurs.
First, students set up the first number with place value disks on the place-value chart:
Next, students try to subtract the ones. However, you can’t subtract 9 ones from 3 ones, so students must exchange a ten for 10 ones and regroup the new ones with the original ones.
Now you have enough ones to subtract 9 ones.
The same exchanging and regrouping process must happen in the tens place, hundreds place, and thousands place, because you don’t have enough tens or hundreds to subtract yet.
Now you can subtract. The remaining disks provide the difference.