Monday, March 30, 2009

Money Monday 3rd Edition

Great ways to teach kids about Money.
It is staggering to me how many teens don't know how to count back change.
I love all the techie stuff that comes along... but, seriously... it just makes us lazy.
Kids and money, and kids and learning the respect of money management go hand in hand.
My son is not yet 15, and for some reason... because he gets a couple of magazines in his name,
Credit Card companies have decided that my son needs a credit card.
At 14.
I know the companies send out massive amounts of brochures and applications to college students and kids who are of working age... but 14!
When we recieve those, I tear up the insides, and place them back into the PREPAID envelope that came with it, and send the torn up Application and CHECKS back to the company.
The company only has to pay postage on the envelope IF IT IS RETURNED to them, so I send them their junk mail right back. I do it with a lot of junk mail. It makes me feel a little like
a vigilante. Yes, I am THAT boring.
ANYWAY... I digress...
Kids and Money.
It is NEVER too early to teach kids about money.
From the very first time someone gives them money in a card and the kid just stares at it like..
"Uh... this is SO not a present!"
There lies your opportunity to teach, after the party goers are gone, of course.
So many parents rush right out to let their little darling spend, spend, spend... right away.
Others take the money from the little darling
and tell him/her they are going to "save" it for them.
Note to parents... When you use the word save in conjuction with TAKING THE MONEY AWAY from the child, they will never truly appreciate the word "save" in the right way,
just so ya know!
I hope to help said parents in this post.
Depending on the age of the child, lets assume it's a smallish child... 4-6 years of age.
Place the money on the table and sit down and look at the money...
then ask questions.
"Do you know how much money that is?"
"You sure got a lot of great things for your party today... and wasn't it generous of Auntie Matilda to give you money so you can go shopping for something later on?"
"Where do we keep money? In our pocket? Or in a Bank? Or do we just throw it away?"
"What do you see Mommy and Daddy use money for?"
"What number is that on the money?
When 20 questions gets boring...
Then move on to...
"Where do you want to keep it safe?"
"How about you and I figure out how we are going to let you use your money."
It depends on your religious, personal or whatever beliefs...
But what I used to say was...
"Okay... in our house, all money we get gets divided into three places. Savings, Charity, and Mama's Slush Fund... Oh wait... No! Household... yeah that's it ... Household. So...
Here's how I am going to teach you how do look at money like a grown up...
1. Always pay yourself. That means, always put 10% of everything you make or get into a savings account... always. It is for things like college, a house, to pay for things when times get tough. (a child is NEVER too young to be brainwashed... er... I mean... taught that they need to provide for themselves for a rainy day... never. too. young.)
2. To whom much is given... much is required. To the child I said "Always try to take care of those less fortunate than you. There are many kids in the world who don't have toys, and parties, or parents... and it is our responsibility to take care of those who can't take care of themselves. So we give from our time, talent or treasure... and money is treasure. It feels really good to give to others...
It makes our hearts warm and keeps other people warm too. So we can give what you feel you want to give... but usually we give 10%. If you want to give more... that's fine too"
3. This is the part the child is waiting for... the part where they find out how much is actually theirs to keep. So when I told my sons their take was $16 out of the $20, they were thrilled!
It may as well have been a million!
Then to sweeten the deal... I reminded them it was actually $18, but $2 was saved. I tell them how it starts to add up so fast! So the next time they get money, I make a HUGE deal about how big their saving account is getting. They get really excited!
The earlier you start... the more of a sound money foundation you will build.
I have never given an allowance for chores or housework. I told my kids that we are a family and we do for eachother out of love and respect for one another... and with that love and respect come the ability to use our money for things they need and at time things they just want.
If you do give an allowance... help them see it as a means of building wealth and some security for themselves.(for older kids) Help them to save up for something they really want.
Maybe start up a Household Matching Fund, like a 401K. You will match what they put into their savings accounts.
It gets their heads ready for the real world a lot sooner, and it won't be such a shock when the paycheck comes and it's all dwindled down.
Oh yeah.. and back to my top comment.
Teach kids to count back change.
Use Cheerios, coins, Monopoly money... whatever...
It will go a long way in making the kid seem JUST a tad more bright than the next
candidate for a job during college.
I hope this post was helpful to many of you!
Enjoy your week!
Save, eat in... and brown bag it a little this week!
Put the savings into a saving account!
Have a lucrative week!


  1. I have to say that I might use your returning the torn up bits and scraps to the company idea. I like that!

    I remember working the concession stand with kids that had absolutely no clue what to do about making change. It's outrageous.

  2. Good grief... I hope they never send my daughter one. She's obsessed with info-mercials right now. We seem to need every $19.95 item on TV!

  3. What a great tip! I'm going to read this to my son who is in great need of a lesson in managing money well. Lately, he seems to think money grows on trees!

  4. I totally agree..... I think kids (and even adults) are getting so lazy with ANYTHING now-a-days because there is always an "easier" way to do it!!

  5. You touched on a subject that I get so frustrated with. I remember the week I took my daughter to college (back in 2001), there were booths of banks there handing out credit cards. Kids were lined up at them. It amazed me. These kids didn't have jobs, they were going to school.

    My daughter has a couple of friends that are now (seven year later) filing for bankruptcy because of the amount of credit card debt they have.

    No wonder our economy is so screwed up. Grrrr!

    Sorry for the rant...

  6. Thanks for the info!! I also love the idea of sending the crap back to the credit card company, I'm going to have to start doing that.

  7. Ok really like tearing up the junk mail and sending it back ~ love it!! Great post! I hate it when people don't know how to count back change. I especially hate it if they miss how much they are supposed to give in change and then get totally flustered since heaven forbid they have to think for themselves!

  8. Come see me I have a 'lil something' for you!

  9. Great ideas and ones I will try to implement as well. I also love how you (you rebel!!!) send back your torn up shreds to the CC companies. YAY

  10. You always have great ideas. Offering a child a credit card is beyond irresponsible and we wonder why the world is stuffed. Maybe you hould run for office or something OR WRITE THAT BOOK!!

  11. Ok-the pressure!!! I must confess-I can't count back change!!!! I need a calculator to make sure I am right...I am so bad, I know.
    I am taking this all in today-We don't pay the boys for doing jobs here-we all live here, we all work here for free. However-birthday money adds up, and I never know what to do with it, and a huge spending spree is not on the list... so this was so helpful. My husband is great with money-but he made me pay the bills when we first got married because I had no concept of money, so now I am a big saver for the rainy days...I just don't know how to teach the kids-so today was so helpful...When is the book coming out???!!!


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