Wednesday, September 25, 2013

Teaching kids the value of money in a world without money.

Spectacles, testicles, wallet, and watch
"If I had a money card like you, I'd have a lot of money!"  Coming from an innocent 7 year old, it almost sounds cute.  In actuality, "cute" isn't even close to how it sounds.  To me, it sounds like dried out Expos on a whiteboard.  It makes me cringe.  How the heck am I going to reverse his thinking?  How do I teach kids about money when I myself don't even use "real" money?   Credit, debit, paypal, bitcoin, etc... are all strides the monetary world is making towards less and less cash.  Today's cashless society, although extremely convenient for me, spells disaster for a kid's financial future.

How do we combat this dreary fiscal outlook?  How much money do they need?  What will they be responsible for?  How is punishment handled?  After about a week of deliberation, we came up with the following plan.  Let's call it our "Future Fiscal Disaster Prevention Act." 

$30 Payday - Each kid will receive $30 every two weeks.  We started with $30, figured we could adjust if needed.  So far, it's worked out.  Not too much, not too little.  With this money, they are responsible for all extra purchases, including, but not limited to: toys, birthday gifts, Christmas gifts, electronic purchases, special food/drinks, etc...  Want some popcorn at the movies?  Pony up.  This also means they need to carry their cash on them.  They make it a point to have shorts with pockets.  I did my part and shared Austin Power's trick for never leaving without the proper gear.  Sign of the cross, saying "spectacles, testicles, wallet, and watch." 

Money Doesn't Grow on Trees - The most important fact; money is earned.  Chores, cleaning, cooking, etc...  We direct.  They do.  And guess what?  They don't mind.  The lure of the prize inspires them.  I watch them scrubbing the sink, mouthing thoughts to themselves, infatuated with their new fortune.  Ask any one of my kids and they will tell you (to the dollar) how much money they have.  But, please don't ask them.  They brag about it freely and regularly.

FBIC - Funds Buried In Closet
Death and Taxes - The second most important fact; everyone pays taxes.  We have a 20% tax rate, due immediately on payday.  Nobody gets paid what they make.  The government always takes a chunk.  They might as well learn that now.  We even make them count it out.  (Mean, right?) 

Speeding Tickets - Break the rules, gotta pay.  Punishments now hit the pocket book.  No more timeouts, just fines.  Don't do what we say?  Dollar fine.  Forget a chore?  Dollar fine.  Complaint uttered at chore time?  Dollar fine.  Dad's broke?  Dollar fine.  (Okay, maybe not the last one.) 

Save for a Rainy Day - Wolf Savings & Trust.  This actually came after we started the program.  The kids were walking around with loads of cash, creating nervous parents.  So, we bought a lock box, set some rules/interest rates, and voilà, we have a savings account.  Deposits can be made in $20 increments.  Each $20 earns interest of 25c per month.  15% return, you say?  You're right, that's fairly generous.  The key here is creating the habit and a big shiny quarter per month did the trick.

There it is.  Our plan in a nutshell.  The kids have taken to it like gangbusters.  Too well, in fact.  I rarely rack up "fine" money anymore.  But, the kid's just might have a glowing financial future. 

1 comment:

  1. A great plan to prepare my Grandkids & ALL children for their future plus financial knowledge! You two are brilliant! ALL parents shud be doing this!