Did you have an allowance when you were a child? Did you put an allowance in place when your children were young? Or perhaps you didn’t have children but watched nieces/nephews and friends’ children learn about money, or not? It’s kind of scary to realize, but super important to understand, that 95% of the time we have with children is gone by the time they turn 18. And squeezing some money conversations in during that impressionable time has the biggest influence on their future money habits.
I Wish I Had Realized Sooner
I feel like this is one of those “I wish I had realized sooner” moments. As adults, we don’t realize the vast impact we have on children and their future. If you have ever asked children about particular memories from their childhood, they often recount an incident that stuck with them but often the adult in the situation barely or doesn’t remember it at all.
I remember a phrase my father said to me as he passed me in our house as I was practicing typing (yes, way back when we had typewriters!): “You’re never going to get it!” And he kept walking.
Think Before You Speak
I asked him about it years later, thinking about how disappointing that comment was to me, and he didn’t remember that he even said it. Sometimes, when we say things off the cuff, it gets remembered by the other party in an unintended hurtful way. Think before you speak is a good mantra.
Think Before You Buy
Just like Think before you buy is a good mantra. I met Karen Holland last year, Founder of www.GiftingSense.org , and she designed a Does It Make Sense (DIMS) calculator that helps children think before they spend. Whether it is a thing, an experience, or a pet, the calculator walks a child through questions that help think about all the angles (not just financial) of making a purchase. We would all be served well with that habit at every age!
Practice with Allowance
Or I started this topic with questions about allowance. What better way for kids to learn about money decisions than to practice using money. And allowance is one way to provide some of that “tool” they need to practice with. My friend John Lanza wrote a great book, “The Art of Allowance,” to help parents learn about the best way to approach allowance for their family. Every family is different!
A Full Guide
Or better yet, if you are looking for the full philosophy and how-to-guide for parents/grandparents, check out The Wisest Investment: Teaching Your Kids to Be Responsible, Independent and Money-Smart for Life by a colleague, Robin Taub. There are so many tools to share.
I’m hoping your adult children are open to resources or often grandparents are very involved with raising grandchildren these days. In hindsight, I sure wish I would have intentionally “dripped” on our kids to practice more with their money skills before leaving home.
Looking for Story Opportunities
Even just looking for story opportunities to share with grandkids can have an effect. Did you witness a good or bad money decision? Are important concepts like earning income, saving for a rainy day, and “sleeping on it” to experience delayed gratification something you could incorporate into your next conversation with grandkids?
Asking Questions
It’s often interesting to just throw out a softball question to ask what they think (or know) about various topics. Their concept of how much anything costs is often pretty hilarious for the young kids. One of our preschooler grandchildren recently told us it cost 60 thousand dollars for the bike she got for her birthday. Just like another one guessed that maybe I was 100 years old.
Practice, Practice, Practice
Even using play money for pretend play or the concept of using a credit card is pretty interesting to see what the grade school agers understand. My 9-year-old granddaughter recently used the DIMS calculator to realize that buying a new puppy to replace the 11-year-old dog they just lost would cost more than she imagined, about $25,000 over the course of its lifetime. She quickly moved to considering a $60 leotard for her gymnastics class (that she would also pass down to her sister and then sell it second-hand).
Blessing to Last a Lifetime
Never underestimate the power of your words and stories as a grandparent/aunt/respected adult in a child’s life. Sharing more of what we wished we had known sooner can be a blessing that lasts a lifetime.
Let’s Have a Conversation:
What can we do as parents, grandparents or family/friend adults in children’s lives to help them practice healthy money habits? If you had to pick one money lesson you wished you would’ve learned earlier in life, what would it be? Let’s help each other with our discussion!
