Start young: play money, toy cash register

As more and more people around me have babies it makes me think about kids more and more. There are so many things to think about: car seats, cribs, bassinets, strollers, names, kinds of diapers, bottles, the list goes on. As they get a bit older the list shifts a bit to other very important ideals that a couple should, for the most part, agree upon in how they want to raise their kids.

When I recently came across this article on how to teach your kids about money it made me think, wow everyone should be starting very early in how they want to approach money with their kids. I was talking to a colleague just the other day. Yes, I can tell you this now, and it is possible that I have no idea what I am talking about! We were discussing how expensive it is to raise a kid these days, let alone thinking about paying for them to go to college. I paid my own way through college. I was in a work/study program, and I worked outside of that too. My parents could not afford to pay for college for any of their three kids. While it would have definitely been nice to have it paid for, it taught me a lot about money, about growing up, and about taking responsibility for my decisions. I probably would not have worked as hard to learn if I was not paying for it.

Now that does not mean that I will not help my future kid(s) out with college, but I want to do it in a way that helps them grow, learn, and understand what their decisions mean financially. Too often, I think parents write a check and walk away, and that does not help their kids learn about life. The above article starts with ages 2-5 on how you can use play money and play “store” together. Oh how I remember the plastic cash register I had when I was little. I loved watching the coins come down the side like it used to at the grocery store. Toy cash registers today I believe have scanners and credit card swipers. Oh well. Parents could still teach the value of money, and include a bit about how someone has to pay for what is put on that credit card.

Start young. Whenever we begin having kids I know I will start young too. I think conversations about wants, needs, and money help kids know and appreciate all that they have in the world. It does not have to be in a way of shame, but from a place of abundance and gratitude.

Start with the basics

Some of you that follow my blog know that I have a passion for money management. My passion evolved because I wanted to make sure that I truly understood what we were doing with our money, and that I trusted the information we were using to make our money decisions. I cannot do that in a vacuum. It means I have to read, learn, and ask the right questions. This recent Daily Worth had an idea that resonated with me:

“Money management is like cooking, or fixing a car or anything else you can learn,” says Myers. “But if you tell yourself you’re simply not good at it, you’re less likely to take steps to learn the basics you need to be financially healthy.”

I have to agree. While I am not a cook, I would feel comfortable calling myself a baker. I learned over time how to work with dough and understand why a recipe called for baking soda rather than baking powder. I am still learning new things about baking, and enjoy trying out new recipes. The same goes for money management. As the world changes and evolves fast, we have to shift and adjust with it, and be aware of whether the decisions we have made in the past continue to serve us, or if we need to adjust our financial allocations based on changes in the market, and our lifestyle.

Some individuals work with a financial planner that they trust, others rely on friends and family, and some look to books, the news, and the Internet to help inform them on what decisions they make regarding their money. Whatever step you take, I encourage you to continue to learn. Maybe you are young and a beginner, or you might have a family and are looking now at how to save for your children’s future, wherever you are in life, there is always something to learn that can benefit you today and in the future.

Did You Pay For College?

I recently read this discussion called: “Why Kids Should Chip in for College.” It is a discussion I support. I had to pay my way through college and while it was tough, it was good life experience for me. It starts the reality that life costs money in a big way. Maybe you do not have to have your child pay for school completely, but they should contribute. If not, what happens when they graduate? Will you continue to pay for their life? How have you helped them to prepare for the next stage of their life where they have to pay rent, utilities, food, car payments, insurance, etc.?

These days with the zillions of technical devices we have at our finger tips, the ease of access to credit cards, and dwindling checking accounts, those graduating from college will have a harder time balancing the cost of their wants with the bills they will now have to pay, with the amount in their paychecks. Do we need to shift the balance of what we are doing for kids today? Have we taught them the value of the cost of life itself?

I remember a class we had to take in high school. I cannot remember what it was called, but what I do recall is that we had a section on stocks. We were split up into teams and we had to decide what stocks we were going to buy together based on the research we did on the company, the rate of return, and many other factors. I cannot remember how well my team did, but it sparked a new thrill inside me of something I had never been exposed to – investing. What I find interesting about this class that we were required to take, was that we never learned about the basics of money: balancing a checkbook, living within your means, interest rates, deciding between how much you can make saving versus paying off debt, and saving for retirement. These aspects of personal finance would have benefitted us way before we were ever at a place to actually invest in stocks.

I wonder how many college graduates know those core personal finances ideas. Are most college graduates savvy with their social media profiles, and maybe how to create their next app, but not ready for the basics of paying their rent, and saving for their next plane ticket? Are we coddling kids today, rather than finding ways for them to be set up for success?

What do you think? Are we preparing today’s college graduates for their best financial future?