I was away for the weekend recently and when I came home I brought gifts for each of my three kids. Josie (2) and Lila (4) each got sneakers (not as boring a gift as it sounds – they LOVE shoes). Gage (6) got a pack of erasers and a book. Gage pawed happily over his gifts, then gave me a guilty look and said, “The girls only got one thing and I got two things.” They have an inherent want for things to be equal, as most siblings do. I began to explain that the shoes cost more than the erasers, so I had extra money for the book, and I could see that he wasn’t getting it. I thought for a moment and said, “Would you rather have four quarters or a dollar?” “Silly,” he said. “They’re the same.” “Well, your erasers and book are the same as a pair of shoes.” Oh.
Age six seems to be the first that I can start teaching about money with any kind of real meaning. Lila is still too young, her response to the dollar vs. quarter question would be: The quarters, naturally, because there are more of them.
I am a big fan of the envelope system, and Gage recently wanted to start an envelope for himself. He has his eye on some sets of Legos, and he knows that (1) I won’t just flat-out buy them for him and (2) he has to figure out a way to get the money to pay for the things he wants. We sat down together and made a list of the sets he wants, then looked up the prices online. We made graphs for each toy, broken down dollar-by-dollar. Whenever he gets a dollar he carefully adds it to his envelope and fills in a little box on his graph. When he has filled all the boxes for a particular toy he gives the money to me and together we buy the toy. Then he starts working on saving for the next toy.
Gage has become very proactive in earning money. We’ve made some deals, like if he ‘babysits’ his 2-year-old sister for ten minutes (so I can put laundry away or something) he gets a quarter. He has a hard time sometimes, due to shyness of strangers, saying ‘excuse me’ when we’re in a crowded place. I told him that if I heard him say ‘excuse me’ four times, he gets a quarter (just to get him over the shyness hump). It worked too well, though, and I had to redefine this one when he started darting purposefully in front of strangers for a chance to excuse himself. As an aside, Gage now knows the definition of the word ‘legitimate.’
A nice side effect of this saving is that he’s doing a lot more math, and he’s eager to do it because it means something to him. He has a small tin that he keeps his quarters in, and when he has four he brings them to me to cash in for a dollar. When he has five dollars he cashes them in for a five-dollar bill, etc. He is constantly telling me things like, “I have thirteen dollars saved for my Legos, so I only need seventeen more.” And “I have twelve quarters; can I trade them for three dollars?”
The biggest thing that I’m happy to be encouraging now is delayed gratification. A lot of poor spending habits stem from “I want this, and I want it now!” Learning to wait, and to prioritize, is a hugely important lesson.