my Kids + Money, Vol. 1
It happened overnight. My eight year old daughter woke up with a lot of questions: How much money do you have? How much money do I have? How can I get more money? What do I do with my money? So began the conversations around regular chores, extra paid chores, allowance, and bank accounts. Honestly, I am making it up as I go along, but here's what's working so far.
We started by counting the coins in her turtle bank. As a second grader, she has learned the basics about money at school and can now do mental math and accurately count coins.
Right away, I ordered her (and her best friend) a “money jars” system. I firmly believe kids learn best by touching real world materials, not only from reading a screen. I ordered this Save Give Invest Spend Money Bank. I got one for her friend as well to ensure that beyond us, her parents, Lucy has a financial confidant, someone to talk to about money.
We took her coins to the grocery store and got some bills. We came home and she asked…
Well, which jar do I put them in?
Is there anything you want to spend on right now?
Candy!
Ok, great, so put some money in Spend.
What does invest mean?
Investing is a special kind of saving that you don’t touch for a long time and it grows and grows and grows.
Ok, I definitely want to do that! I want a million dollars!
What is Give for?
Some people like to give money to charities and non-profits and people in need, like homeless people or children without toys.
She silently put money in Give. (I could tell she was thinking deeply about this).
Later and totally unexpectedly, the seeds I had planted about giving led to a significant baking project where she raised $80 for Project We Hope is East Palo Alto. She also kept $80, exactly half the profit. That was her choice and even though her grandmother shook her head and thought that Lucy should donate all of it, I was proud of her. She worked hard (with help) even with school, homework and 16 Nutcracker performances happening around the same time. And, I can see how easy it would be to expand and create a neighborhood effort next year and raise much more money to donate. If *you* too would like to participate in selling coffee cakes during the holiday season to raise money for the homeless, let me know!
Then we had to face and embrace a conversation about chores. Some parents believe kids should never get paid for chores. Chores are part of being in a family. I definitely agree and when I looked more closely, I saw how much Lucy already does and that her household responsibilities have naturally increased as she’s gotten older. And, I believe there are many opportunities for meaningful paid work at home. We talked about all the things she does taking responsibility for her part in taking care of our household. And, we brainstormed a new list of “more intense” chores, ones that take longer, are a bit less fun and are not exactly easy. Ones where she might get dirty, there’s some skin in the game and extra effort is involved. There’s no right or wrong way to parent or to do chores for money or not. Every family has their own set of values around chores and can navigate this topic in their own way. If you need help getting started or knowing what’s generally age appropriate, check out this guide:
Lastly, about bank accounts. To keep my life simple, I opened my daughter a Kids Savings Account at our primary bank. It comes with a debit card which I am excited about for future deposits, withdrawals and even spending, though I plan to help Lucy use cash as much as possible for the next several years. I was able to show her a modest balance online that was already in her account from, unbeknownst to her, gifts from grandparents, but she quickly forgot about that. The coins and bills, mostly ones + a couple fives + a twenty have really captured her attention.
The paper bills have fully captured Lucy’s little brother’s attention too. I caught him, he’s four, and his friend sneaking into her room, taking some of Lucy’s money and stuffing it into their pockets. I nonchalantly set a boundary, took it back, returned the funds and put her money jars out of sight and reach for the little ones. I wonder if this will be Max’s first financial flashpoint or memory with money. Only time will tell. Clearly, cash is by far the best way to help a child (and adults too) be fully present with money. Stay tuned for Volume 2 of this ongoing story.
ADDITIONAL RESOURCES
Best Age for Kids to Start Doing Chores, Psychology Today
Sparing Chores Spoils Children and Their Future Selves, Boston Globe
Why Kids Who Do Chores Become Successful Adults, Motherly
Kids Who Do Chores Are More Successful Adults, Inc.
The Single Best Things Parents Can Do to Make Sure Their Kids are Successful, Business Insider