The money talk, that is. Start talking finances with your kids early
“You don’t need that.” Startled, these words snapped me out of my Super Target daze. I turned away from the dishtowel I had been admiring to the little voice at my left.
“You don’t need that, Mommy,” my not-quite-3-year-old daughter Charlotte repeated. She was right. But how did she grasp that concept — one that eludes many adults — at such a young age?
I know she’s heard me talking about needs and wants; I make a point to mull over the concept as I shop — as much for me as for her.
Given the negative news these days about our savings rate and our indebtedness, it’s clear that the difference between a need and a want has become blurry in our consumer culture. Nathan Dungan, president of Share, Save, Spend, a Minneapolis-based company that aims to teach “financial sanity,” says we are bombarded with 5,000 consumer messages each and every day. And it starts early. Just ask Charlotte what kind of dog food our pooch would prefer to eat and she’ll proudly announce whatever brand is being advertised between Dora and Diego.
Financial literacy has become the cause du jour — with everyone from rap mogul Russell Simmons to Federal Reserve Chairman Ben Bernanke weighing in on the importance of financial education. Personal finance is gradually being added to school curricula. Bookstores are lined with manuals teaching parents how to teach kids about money.
All of this is fine and good. But teaching kids about money is easier than we’re making it. Here’s what we need to do: Talk about money with your kids. Start young and start simple. I babbled on about the cost of diapers and why I use coupons with Charlotte long before she could grasp the concepts. Although other shoppers probably thought I was nuts, I wanted to get into the habit. Besides, it beats baby talk.
The Credit Union National Association came up with Thrive by 5, a resource where parents can discover reasonable money lessons to teach their preschoolers. For example, by 5, kids can understand that money is exchanged for food or a trip to the movies, that Mom and Dad go to work to make money, and that ATM machines don’t spit out infinite amounts of cash. Young children are also acutely aware of waiting and can grasp that saving money for later use is the financial equivalent of “Are we there yet?”
So when that piggy bank gets full, take it to the bank. Up until now, my daughter’s piggy bank has been the go-to destination for Mom’s quarter raids. She also has an online savings account funded with birthday money, but she’s not aware of it. Now it’s time to put the passbook in her hands. Find a bank or credit union that will give your child the VIP treatment. And make a point of stopping in.
If you want more help introducing money to your little one, there is a growing number of resources geared to the sippy-cup set. Sammy Rabbit teaches kids to save in his books and the Money Mammals DVD introduces kids to the reality that there’s only so much money, so spend wisely.
A new bank account and a DVD won’t do much good, however, if you’re a financial basket case. Try your best to make a change. Kids not only parrot what they hear; they mimic what they see. If you spend beyond your means, let the bills pile in the corner, and never set foot in a bank, why would you expect your child to be any different?
Kara McGuire is a mom and personal finance columnist for the Minneapolis Star Tribune.
Thrive by 5
CreditUnion.coop/thriveby5
Sammy Rabbit
ItsAHabit.com
The Money Mammals
TheMoneyMammals.com
