Youth & Money

Parent and child showing saving

Face it, most adults don’t like discussing money. We all use it, but most stop there. I would venture to say it’s an attitude our culture has embraced to help us deal with the anxiety many feel when the subject of money comes up.

Although this appears to be the norm, it doesn’t mean we should pass this attitude on to our children. I realize this is much easier said than done, but educating adults on the basics of money makes a conversation of money with kids easier and more enjoyable. The following examples are things I’ve done with my son and wife to make sure the topic of money is not taboo and that my son learns early on how it all works together.

Why is teaching our kids about money and all things related important?

Because money, taxes, retirement, starting a business, etc., are all interconnected and have a direct impact on our local and national communities. Teaching kids about all of this will have a direct positive impact on our communities in the future.

Teaching our kids about money should be fun.

It has been shown time and again that one of the best ways to teach kids and adults new things is through games and experiences. There are a number of board games (Pay Day, Cash Flow, Monopoly, Life) that introduce and teach kids about money, budgeting, and investing. I have played these games a bunch with my son. Each time we play, we both learn something new.

Just the other day my seven-year-old son played Pay Day with me and my wife. He was able to add up his monthly bills in his head and pay the bank. He understood the cash flow coming in and going out, and did it totally on his own. It was great to see him grasping not only having to pay bills, but in the context of cash flow and budgeting. If I used these terms with him in general conversation, he would have no idea what I was talking about, but in the context of the game, he totally got it and was having fun figuring it out.

Starting and running a business.

So much can be learned from this educational experience. With my son, it started when he commented how he wished there was something he could do to make our 15-year-old dog, Murphy, feel better since he suffers from arthritis. His idea: an all-natural dog treat that not only tastes good but helps dogs feel better. Although this was a fun and exciting start, the real learning happened when he proceeded, with help from me and my wife, to understand how to make a business out of it and what that meant.

He came up with a name, MurphyBites; drew the company logo; and then wanted to make the first batch of treats. Instead of our paying for everything for him, we discussed how if he really wants to help dogs feel better, he’d need money to make it happen. To fund his business, he agreed to sell toys he no longer used. He took the money, put it in his wallet, and went with us to buy all the ingredients and supplies to make the dog treats.

At the store, he found what he needed, compared prices, and paid the cashier with the money out of his wallet. After perfecting the dog treat, he signed up for a kid’s business fair, where he set up a pop-up shop alongside other kids and was responsible for interacting with customers, explaining his product, and conducting sales transactions. We, as parents, were only allowed to watch. Although my son was nervous, he learned about starting a business, using money to buy raw materials to turn it into profit, and how he can save some of the money for things he wants in the future.

Keep in mind that I never force any of these topics on my son. I want to make sure his mind is open and that he is eager to learn. If I forced it, he would want nothing to do with it.

Recently he was given an assignment from his teacher to write about a current event. The report was due around the same time as taxes (April). I suggested he write about the history of taxes. His first question was “What are taxes?” This led to a fun, informational conversation about taxes—how they are generated and what they are used for. He thought the idea of taxes was really interesting since it paid for things in the community, like roads, police and fire departments, and libraries. Since he was familiar with these things, he was interested enough to learn about taxes. He ended up writing about the history, and even used the example of how when he wants to buy a toy at the store, he must remember that the cost on the shelf does not include sales tax. He never stops talking about it now.

There are plenty of other examples of how to teach our kids about money. The point is that the topic of money should be embraced. Instead of just glossing over anything related to money, make a point to chat about it in a way that promotes learning. By making it fun, my son is learning things that will benefit him and those around him for the rest of his life.

Unsure where to start? Buy a board game about money or check one out at the library, and have a fun family afternoon or evening playing the game. Who knows, maybe you’ll learn something too.

Photograph by Eric Tadsen

Derek Notman is a Certified Financial Planner® and Founder of Intrepid Wealth Partners LLC.