Teaching kids about money, its value, & values can be frequently connected to each other.
Kids learn when they are young that money is something we trade for something else.
Teaching kids “value” is also something we can introduce to them when they are young.
How many times as parents, have we heard, “Mom/Dad, will you buy this for me?” We tell them, no, but you can spend your own money to buy it and then they decide they don’t want it. As the parent, you might think, I sure am glad I did not spend my money on something they don’t really want. I know I did & was glad that I had responded the way that I had.
Yes, the kids thought they wanted “it” & they did, when they did not have to pay for it. The “value” changed when they needed to spend their own money. Kids begin to learn that “value is what we think something is worth”. If we buy it, they don’t have to think about it. If they buy it, the value or the cost becomes a reality. Kids can become “pretty tight fisted” when it comes to spending their own money & that is a good thing.
Indirectly, they are also learning “relative value”. Yes, I want that, but I want something else more. Slowly, they begin to learn delayed gratification, priorities, & the need to save their money for what they want or think they need.
Kids often think that they need a certain brand of clothes or perhaps shoes & there are a lot of reasons for them to think this way. As parents, we can choose to re-enforce this belief or use it as a springboard for education. Yes, they might need a new pair of jeans or shoes, but you could set a dollar limit on what they can spend. If you want to spend $60 for that item & they want something more expensive, tell them they can earn the difference & you will give them the $60 when they have enough money to pay for it, Until then, they wait or can have the $60 item.
Teach your kids to count & also teach them what counts
• Tell your kids that advertisements are designed to try to get people to buy things
• Educate them that retailers place “impulse items” at the check out in the hope that you will decide to buy it while you were waiting in line
• Teach them to comparison shop: buy the store brand or the name brand? What is the difference in cost? Let them know that sometimes you can taste the difference, but most of the time you cannot. Why spend more money on something you can’t even taste?
Perspective on our possessions can help us learn about value as we develop our values:
• When my son, Jason, was in 9th grade he tutored Hispanic children in the Colonia’s outside of McAllen, TX. Most of the children’s parents only spoke Spanish & lacked education to help their children with their homework. Jason tutored one day a week for the school year & grew to be more thankful for what he had. After his 1st visit, he told me he was glad to even have a pair of shoes. Serving others that had so much less, made his heart more sensitive to other people – less judgmental, more caring. Of course a boy is not going to tell you that, but I could see it in his actions. For example, when he was older, he & a friend bought pizzas & served them to the homeless, who were living under the bridges in Houston.
• Learning to appreciate what we have helps us value our possessions; it subtly teaches perspective & gratitude
Build their self-esteem. Become an advocate & a role model to show them “who you are is more important than what you own”
• Share good examples of living “beneath your means” – tell them Warren Buffet is one of the richest people in the world & he is well known for being “frugal” with his money
• Tell them that even though Warren is worth billions, he still lives in the same house he bought before he had very much money
• Let them know there is a big difference between what you make, what you have, & what you keep
• To have money, we need to learn how to earn it, how to spend it, how to keep it, and how we try to make more money by saving & investing
Marty Rubin said, “A scale can tell what a body weighs, but not its value.” Like wise, our value comes from within – not outside of ourselves.
Thanks for reading,
Deborah Ann Fox, CPA uses her “money” knowledge to help families & small business with budgeting, homeownership/debt, tax planning (saving), cash management, etc. She is available for side-by-side, local, & remote appointments. She offers free 30-minute consultations.