mini money manager
Filed Under Tips & Tricks | January 8, 2010
In the wake of the holidays when the bills start rolling in our thoughts naturally turn to money and how we managed (or mismanaged) it during the past season of giving. And the next natural place our thoughts turn is to teaching our tots money self-reliance and management. So we asked Ruth Kewin, one of the mums behind local company Four Quarters Literacy Inc. for some fiscally wise advice on helping our kids develop good money habits.
Why is it important to give children a good foundation in money management?
Understanding money is an essential life skill. By actively teaching money management techniques to our children we are sending a powerful message. We are allowing children to hope and dream. We are giving children the tools to achieve their goals, build confidence and take responsibility.
Learning good money management skills sets a strong foundation for success.
How and when can you start teaching your kids about money?
The way we, as parents, handle and react to money is teaching a behaviour and an attitude towards money to our children. For lots of reasons it may not be the lessons we wish to teach.
Try and be intentional about your language and the messages you’re sending about money and teach them the language of choice such as “No, that’s not in our budget this month” or “this month we’re not spending our money on that, we’re spending our money on this instead.”
Our philosophy is that creating intentional lessons around money is important. Start them young and give them experiences that allow them to acquire healthy, positive habits. Teach them to save, spend and give. Once the platform is in place we can confidently take advantage of “teachable moments” and natural milestones that children reach as they explore the use and value of money.
For kids from three to five let them have the experience of touching real money and seeing real money, not just credit cards or debit cards. General numeracy and counting are also great. When they’re ready getting them counting things – any item will do, not just money – in sequences of five, ten, twenty five etc.
And get them making successful choices. If you’re going to the toy store have a conversation about what are the top three things they want. Then narrow it down to their number one choice. But don’t overwhelm them with too many options as they’ve very concrete in their thinking.
When do you suggest starting an allowance and how do you decide how much to give them?
Money already comes to children in a multitude of ways (including – and absolutely not limited to – gifts, grandparents, scooped off the bedside table, reward). Giving an allowance is a personal choice for parents and there is no right or wrong decision. However, in our opinion, by giving an allowance we are providing a structure and consistency in our children’s exposure to money. This structure allows for more effective teaching. It provides a more effective platform to build positive habits.
How much allowance to give is also very personal. A common suggestion is a loonie for every year. For example, if your child is six-years-old then $6.
A word of warning – giving an allowance only works if you actually give the allowance. As a parent, we need to plan and be consistent. “Of course” you may say but it’s surprising how many times we hear “can I give it to you tomorrow”, “oh, I forgot”, “I don’t have any cash right now”. Think about what children are hearing and learning from this. Put yourself in their position and imagine you are expecting a paycheck on the last day of every month but the money didn’t turn up. The emotions you feel are certainly not positive.
What sort of conversation do you have with them before you begin their allowance?
If parents have decided to provide an allowance it’s a perfect opportunity to open a conversation about why we manage money. It’s about creating and making choices. It is not about how much money you have but how you choose to use it.
What’s the one thing you’d suggest every parent do to help their children learn money management?
One comment we consistently hear from parents is “I wish we were taught this when we were growing up.” Start teaching good, consistent habits about money when your children are young.
What tools can a parent use to help their kids learn about money? Are there any books you’d recommend?
Managing money is an acquired skill. In the same way your children learn to read books, write stories and solve math problems, they can also learn the importance of money and how it works. When your child is ready give them real money to handle and count. We have three kits for kids, teens and young adults that are designed to bring teaching into the home. We provide the tools to allow a parent, grandparent or family friend to coach and mentor a child, one step at a time.
Surprisingly, there are very few money management books available to young children (most seem to be written for the older child). From the Berenstain Bears series there’s Get the Gimmis and Trouble with Money. Also check out Alexander, Who Used to Be Rich Last Sunday from the Alexander series by Judith Viorst.
We are currently building our own four quarter$ reading list. The first book that our team is reading is It takes a Child by Craig Kielburger. This book speaks to one of our (four quarter$) pillars of learning – Giving.
Are there tools for kids under five to help them learn about money management? Piggy banks for example.
We’ve all seen enough dusty, neglected and forgotten money boxes to realize that having a place to put money is important but it is only one part of the puzzle. You need to make money come alive to children. You need to give children the opportunity to touch, to use and to recognize the value of money. Learning comes through conversation and experience. A deeper knowledge and structure evolves over time.
Our philosophy is that we need to address both how to manage money and why we manage money with our kids.
How can we make sure our kids to buy into what we’re telling them instead of dismissing us as we may have done with our parents?
We don’t tell our children. We facilitate their learning by providing structure, conversation and a method. Children become empowered when they make their own choices. Starting young makes it easier to develop positive habits. As a child’s knowledge and confidence grows so does their ability to make informed decisions and positive choices about money. A positive attitude towards money stays with them as they move through childhood to become young adults.
Our role as parents is to teach them, show them and watch them succeed.
We’ll be starting our six-year-old on an allowance soon so we’ll be blogging about how that goes.
Leave a Comment
Let us know what you think or share your great finds with us so we can share them with other Vancouver mothers!
