Teaching Kids About Money
☑ LMY VERIFIED
Featuring Andrew Elterman, BCU Member Experience Specialist (0:39), on different lessons by age, the importance of meeting kids where they are, and puppetry in practice, Valerie Cruz, BCU Member Experience Specialist (10:01), on the financial trade-off, explaining the difference between responsibilities versus work for pay, and the effectiveness of tangible money goals like a vision board and paying with cash, and Marcey Gaughan, BCU Instructional Design Manager (20:24), on leading by example, encouraging money mistakes in a controlled environment, and emphasizing communication on the learning journey.
When it comes to teaching kids money, there is no rule book. However, there are ways to make it more interesting. Meet your child where they are, make the lesson tangible, and create a safe place for them to make money mistakes.
Andrew quotes, “Every kid is different and learns differently... If you judge a fish by its capabilities to climb a tree, the fish will never succeed...”. He explains the importance of meeting your child where they are when it comes to sparking interest and gaining attention. Music, dance, nature, magic, sports – the right topic is your key to starting a conversation or demonstration about money.
Puppetry is one great method Andrew uses to engage his son in different topics, like financial education. “We were in a pinch and needed anything to try to get him to calm down... I took out the puppet and for the first time in his life he was smiling, giggling, interacting, and that was the moment I knew”. Don’t be afraid of trial and error – it gets you closer to what will work for your child.
For Val, she learned that you cannot pay your child for responsibilities. “It has to be something outside of her responsibilities that you can reward for...”, Val says. She recommends making the distinction between chores and work pay to set expectations for the real world. Paola (Val’s daughter) will not get paid to clean up her room, but she will get paid to put away family dishes or fold the household laundry.
Emphasize the tangibility of money when establishing chores. Making money tangible can be done by using shoe boxes designated as ‘spend’, ‘save’ and ‘give’, and physically allocating dollar bills to certain envelopes for certain uses. It can also be done by creating a vision board of cut outs illustrating money goals and dreams.
Marcey says, “We had to start asking them to make a list... Distinguish what they want versus what they need”. Rationalizing money spent is not something we learn and get right for the rest of our lives; It’s a muscle that we strengthen with experience. Find ways to share your money mistakes with your children to help them prepare for their own. Explaining your lessons and leading by example is arguably the most powerful way to teach your child about money.
Check out Andrew and Lee (puppet).
Featuring Andrew Elterman, Valerie Cruz, and Marcey Gaughan | Edited by: Dani Buschick
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