This one’s for you Ado.
Last time I gave you guys my 2 cents on why I think children should be taught the value of money. My goal today is to present some tools and strategies from across the net to help you do this in a cashless society.
I’m not going to pretend like I know everything about children or money. Heck, I don’t even have children yet. Yet? I’m also not a millionaire yet. Yet.
So what value do I bring? I bring my beliefs and, hopefully, some experience.
I believe financial literacy is just as important as English literacy, I believe people should feel comfortable talking about money and I believe parents, yes the parents, have an obligation to teach their children about basic life skills such as the difference between a debit card and a credit card.
BOOM cashless society segue!
Did you know that Kiwis made 140 million electronic transactions in Feb-2019? This equates to about $6.9 billion in one month alone and it continues to grow! Insanity.
With fewer people transacting in physical cash how do we show, let alone explain, what money is to our little ones? If you’re anything like a human being you learn through your 5 senses. Kids are the same, they learn to pick up the phone by watching you do it, they learn what a hug is when they feel your warm embrace, and they learn not to stick a 2 pronged metal object into a wall socket when they get blown half-way across the room with their hair on fire #truestory #thisisme.
Right, so this post is about HOW to teach your kids about money in a cashless society; let’s get back to it.
I scoured the net to find some insight on the subject and came across this which gives some awesome tips. I’ve taken the liberty of summarising key points, adding a bit of my experience and notes along the way.
Start Early, Make it Visual, Take an Active Role
In general, “The New Age Parents” suggests to start talking about money early, i.e. toddler age. Before you ask what financially irresponsible parents would give their toddler a BNZ Platinum Plus Credit Card (best cash back rewards btw), back up and read on. They suggest setting up physical piggy banks or savings jars which you encourage your child to drop coins in to. The goal here is to imprint the act and not about teaching them the glories of saving – that comes later my young Padawan. Keeping physical jars keeps things visual for them (thinking back to the 5 senses) and your active participation and interest in these jars illustrates its importance to the toddler at an early age.
This is the part where I share my learnings as a teacher. You read that correctly. I was once a teacher. I taught Elementary School English in South Korea and it was one of the hardest things I’ve ever done. Imagine this, a foreigner approaches you in the street to ask for directions, their English is spotty at best and you’re in a rush. You decide not to leave this poor man to wonder aimlessly so you try your best to help without using any words. You point and swivel, using your hands like a bendable SAT NAV, make grunts and gesture landmarks. They finally get the message only to get lost once again. Now imagine this foreigner is a child with no desire of listening to you, you’re in their country and in a class full of little rascals that can’t understand any of your instructions.
What was I to do? Luckily us Native English teachers had a secret weapon. Games. We created Power Point games like the classic “Bomb Game” in which children got points by answering questions relating to English. Some of these questions had points underneath, some had bombs. It drove the kids bananas watching other teams reveal a bomb card because it meant they lost all their points. They loved it and so did we because the kids were learning through doing.
I’m not suggesting using Power Point games to grill your children about money. What I’m suggesting is to leverage money gamification to your advantage. Check out this cool Kiwi article about Gamifying Finances. It talks a lot about what I just described above and introduces you to Banqer a finance education platform that teaches grade schoolers about the value of money. It’s sponsored by Kiwibank (man these guys do some cool stuff).
The Fictitious Household Economy Experiment
Warning, I’m about to get all Asian Dad up in here, right now, so strap in.
I wrote a bit about starting financial education off early in a cashless society and about keeping things visual, taking an active role in educating and about using gamification to help children develop good money habits. Now I want to share with you an idea that I had whilst thinking about this topic.
I want to see whether constructing a fictitious household economy could prepare my spawn for real life. It’s going to be a bit of an experiment really so, if I’m still writing blogs in the future I may give you, my dear readers, a bit of an update on how that’s going.
What is a fictitious household economy? In my mind, it’s an economy based solely on the household the child lives in. Chores done will be paid, living expenses, and “luxury goods” will be charged for and savings will earn interest from the bank of mom and dad. Obviously we’re not talking market rates here but the skill I want my child learn is cash management and a basic understanding of how the economy works. This would be a cash system (keeping things visual) at first but could move into cashless at a later point in time.
Thinking something like this to start out with:
|Chore Income||$1.00||per chore|
|Living Expenses||$1.00||per week|
|Savings Interest Rate||30%||p.a.|
Obviously theres alot of planning I still need to do but… what do you guys think? Am I going overboard? Have I become a crazy asian “pseudo-dad”? Will Robin ever do away with Batman and form his own crime fighting series? Find out next time!
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Disclaimer: This post is for entertainment purposes only. It contains only general information about childhood and financial matters. It is not advice and should not be treated as such. I am not an expert in children psychology nor an expert in early childhood education.