Pocket Change: Teaching Children About Money
As much as I value parental lessons and cautionary tales that dissuade curious children and teens from doing things like, eating stuff off the sidewalk, cheating on tests, filling up on bread, wearing dirty clothes, having unprotected sex, hanging out with the wrong crowd, being unkind to animals, taking other people’s property, ingesting drugs and drink, and generally acting without any morality of common sense, I have always felt that one lesson gets routinely, and grossly overlooked. This is a lesson that we all would have benefited from if it were stressed with the same sort of urgency and emphasis that we put on issues involving sex and drugs. Had we all learned this collective lesson ten, fifteen, or maybe twenty years ago, I would bet the world would be a far better place. The lesson is about living responsibly and ethically with money.
Now, full disclosure, I am still learning this lesson as I continue to pay off debt from more frivolous days of yore, but the important thing is that I am learning it, and almost prepared to teach it. I grew up in the “go-go 80s” and witnessed astounding instances of financial recklessness and immaturity. On my first week in college, they were literally handing out credit cards to any one with a name and the ability to grasp a pen for the 3.5 seconds it took to sign away your financial future. I watched more friends sink into abysmal voids of debt than I saw people fall victim to drug abuse or violence (and believe me there were plenty of both). Somehow we missed the most basic economic lesson of how to live within your means and show due respect for the ebb and flow of money.
Now, for those of us that have survived and chosen to procreate, we are left with the dual privilege/burden of teaching our children essential lessons about money that had eluded us in the past. We will likely start simple with things like allowances and savings accounts (elementary stuff) and then move on to harder lessons about living within your means and remaining savvy in a world with numerous temptations as well as tricksters. I let my toddler handle money (even though I know it is horrendously dirty) and routinely talk with him about how much a dollar is worth, how we don’t always have enough money to buy whatever we want, and the necessity of doing without.
Considering I hardly have all of the answers, I wanted to know how you approach the issue of money with your children? And how much has our current, and enduring, financial quagmire factored into how you deal with the subject? Do you warn your children about the dangers of credit, money for nothing schemes, bubble economies, etc? What are some of the key lessons you think everyone, especially children, need to know about being fiscally responsible and financially ethical? Please share, we are all listening!