Investing in Our Kids. Should we give our children financial advice? Babble.com
When we give children financial advice, what are we really teaching them?
Investing in Our Kids
When we give children financial advice, what are we really teaching them?
by Maria Laurino
August 6, 2009
With our economy in a major meltdown, it’s no surprise that we’re being bombarded with advice about our personal finances. But in the past year, the emphasis of that advice has made a surprising shift: the media, schools and banks are all telling us that we need to teach our young children about money, before it’s too late.
Take “Fiscal Fitness,” a course for grade school children which teaches those “as young as eight the nuts and bolts of money management”: a former banker brings her multi-slotted piggy bank into classrooms to instruct children on financial skills like saving and investing. Or the newest attraction at Epcot Center, “The Great Piggy Bank Adventure,” a series of games in which players, guided by a talking piggy bank, “move levers to ride the currents and capture falling coins before they’ve been reduced in value by the evil wolf and his sinister inflation machine.” (This attraction is sponsored by investment firm T. Rowe Price; the bank ING is also getting into the action with its newly launched gaming website for kids, “Planet Orange.”) One recent news segment showed six-year-olds writing checks and swiping credit cards in an updated version of the classic board game Monopoly, which now comes with its own credit card machine. Is this how we teach our children well? At four they learn to wipe, at six to swipe?
I remember my first hesitation about introducing the concept of money to our son. As a two-year-old he was given a “dinosaur bank” as a birthday present. The mother handed the gift to me saying, “My kids just love watching the money go down and build up.” Our son would feed change into the blue mouth of the dinosaur. Each penny, nickel, dime, and quarter clanked its way down a long wooden neck carved like a corkscrew until reaching the plastic globe belly with a triumphal ping. The belly grew bigger as the loose change accumulated, and only a screwdriver could open the bank. The money was elusive – seductively piling up and ultimately out of reach.
I didn’t want my son to horde his money, savoring the pile at first, and then longing for all that change to buy some toy he had in mind. I felt that once such a mindset developed and the belly of the beast was finally opened to let the change flow out, no toy would ever compensate for the empty feeling he would have staring at the penniless plastic globe in the belly of the dino.
So I made a simple rule. Every Christmas season we would open the bank, count the coins, and put them into individual paper rolls – the most fun activity – in order to cash them at the bank. Then we’d donate half the money to our local soup kitchen and my son could have the rest to either spend or put in a savings account. Once we established that dino helped to create our holiday soup kitchen project, I felt better about its trickle-down neck, perhaps an intuitive reaction to my aversion to trickle-down theories.
The idea that we should teach young children more about finance and credit in a money-fixated culture seems to me like helping a shipwrecked passenger in the middle of the Atlantic by tossing out a noodle from the swimming pool. If we weren’t so obsessed with individuals making as much money as possible – rather than acting collectively to help improve the lot of the community – we might not be in the predicament we are today. So why not use the short and elusive time of childhood to teach the great virtues, not the little ones?
It’s difficult for me to believe that parents nowadays are able to teach their kids about finances when they themselves are at a lost. Maybe I’m wrong but just look around at the state of the economy, the American educational system, the environment. Priorities are all messed up, where it’s more important to be “fashionable” and “to fit in” (disguised in the word to socialize) than to be wise and conscientious of your own actions.
I think it’s possible to teach your children to be prudent with their finances and prevent them from worshipping wealth at the same time. Learning how to save and budget are not without value; if anything it allow them to make choices with their money. Ideally our children will inherit our values and choose to donate or invest in the public good over personal gain, but that will be their choice to make in the end. However, if they don’t understand how money works they run the risk of being controlled by it.
Another anti-capitalism essay. How wonderful. Is there anyone left out there who has some common sense? Money is not bad. Money is good. It is a means of exchange that allows us to have freedom and a larger life. It allows us to be able to travel the world if we want to enjoy the beautiful art of the centuries. It allows us to experience different cultures and foods. It gives us the best health care in the world. Money is good. Money is good. Stop demonizing money. It is a necessary part of grown up life. I am really tired on these kinds of articles.
Let me guess the following about you: Democratic, Obama Supporter, Eating Granola, Driving a hybrid (or want to), love abortion, hate greed and see it everywhere, care more about frogs than your neighbors having jobs, love unions, hate guns, don’t keep score at your child’s games, don’t believe in “grades”, like high taxes because it’s good for us all, part of the food police, you like pilates and yoga…I could go on.
I am convinced that the environmental movement is nothing more than a disguised anti USA anti-capitalism movement. No thanks.
sickofit – wow – what a juvenile hissy-fit.
nobody says money is not important. of course it’s important to be smart with money and there’s nothing wrong with making money.
i think the point simply is that money and material things are not the be-all end-all.
there’s nothing wrong with capitalism. capitalism is good. it’s a model that works with, not agains, human nature.
the problem is materialism. if all you care about are things and money, then you lead an empty life. and before you have another tantrum, please note i’m not talking about YOU specifically…
you can have a capitalist economy without a materialist culture. it’s very possible.
OF COURSE it’s important to be smart about money. but i think the point of the essay is that if you focus JUST on money and financial education, you miss out on the broader and bigger questions. if you teach your kids to be smart about money but not smart and wise about life, then they’ll end up a bunch of acquisitive bean-counters.
so please, retire the paranoid capitalist screeds, take a deep breath and try to be open to things.
thank you for that rather insightful article. Having grown up in the east I found my childhood idylic. Living with my children in the west I am forced to rethink my attitues as although i would love for my kids to grow up like i did sadly the world is a very different place. Back then we had family around us constantly, so bringing us up was the job of my parents grand parents and various other members of the family. Our values and how we behaved was a constant source of family pride, money never factored into things as much as it seems to do today.
Out here the reality is very different, money does make the world go round and teaching children the importance of it is very necessary. Going to college I found myself raher unprepared for dealing with financial matters and will not allow my kids to grow up without at least knowing the basics.
Interesting. Not sure I understand why learning about savings accounts and learning about art and joy are mutually exclusive. I think of teaching financial advice as similar to teaching hygiene skills — not exciting, but necessary, and more important the older you get. It’s not like kids WON’T learn about money if you don’t teach them, they’ll just be putting together what they see and hear in the world away from you.
And I would definitely argue that this essay grossly misrepresents “Get To Work”, a book I just finished reading that encourages women to have a place in the public sphere because that’s where the world’s decisions are made. Perfect reasonable advice, in my opinion, although I did study art in school and still make a good living. She doesn’t scold women who stay home, she just points out — accurately — that they’re putting their own future (and the future of their kids) in someone else’s hands. Neither here nor there, though.
That said, I love the piggy bank idea and will steal it for my own two-year-old’s first piggy bank.
I can’t help feeling that in a small way this article had a bit of anti-working mom bias. I choose to work for many reasons, though financial freedom is certainly a factor. Does that mean I am teaching my child only greed and consumerism? I hate articles like this – why even bring up the working v. staying at home thing (again). Just because I didn’t choose to have less money to stay home with my kid doesn’t mean I am not trying to teach her the great virtues.
Wow Sickofit- you really hit the nail on the head. Or Not.
Don’t generalize and demonize the author. She didn’t say money was bad she basically said its more important to teach our kids to be GOOD PEOPLE than money hungry adults. You’re so quick to pigeonhole people, how about I be just as childish as you.
Let me guess, you’re an evangelical right wing, gun toting, anti-abortion, FOX news watching, SUV driving, Palin supporting republican who believes we’re on the path to socialism. See? I can do the same thing.
It doesn’t make you seem insightful, it makes you look ridiculous. You can have good health insurance, travel the world, and have a good job while caring about others and the environment, as my husband and I do.
I’m not anti-capitalist but I do think its important for my child to know the following:
- The value of money (not more important than a human life)
- Working hard to get what you want
- Being a responsible consumer
- Making sure you do your part so that the world is somewhat better for future generations
- BE KIND AND CONSCIENTIOUS
Being raised with the above, I think he’ll turn out just fine and know what to do with money and hopefully mirror what my husband and I have done. Worked hard, saved money, bought nice things, and then give back to your community somehow.
Managing finances is a self-discipline. Raising a kid to be disciplined in this way is what’s needed for a lot of success in this world.
I love my parents. They are warm, caring people and they have raised 3 warm, caring kids. However, we all suck with money, and have learned the hard way more than once that being stupid about money is something you pay for over and over again. I fully intend to teach my kids more about money than what I was armed with when I went out into the world. I don’t know any of the people who teach their kids to worship money, so I guess my perspective is different.
I must say that I disagree with the premise of this article. I am ‘good with money’ and learned the skills of being so from my parents. Because I’ve been educated about spending conservatively, building and using credit wisely, not to mention saving and investing in order to achieve long-term goals I can live the life I want without being focused on money. I am a teacher and my partner is a social worker; we live in an expensive urban area where we love our diverse communities; we give our time and money generously to a handful of nonprofits whose mission we are passionate about. If we were using our limited funds to pay interest on our credit card debt, the mortgage on a house beyond our means, or a lease for a nice new car we would be unable to afford the luxury of living a life based on service to others without continually worrying about our financial well-being.
I love the idea with the dinosaur bank. My daughter has one, but she
sees it more as entertainment (coins go in, bank gets opened, coins go
back in and so on), and the unscrewing of the dinosaur’s belly is all
part of the fun.
I do think it’s important to teach kids financial skills, but I’m not
sure they need to start budgeting at 6 and I do think it’s unfortunate
how focused on testing and concrete measurements education has become.
We seem to lack any sense of balance.
I did not see the article as anti-capitalism or as the voice of crazy liberalism.