As adults, we know the importance of managing our money. If we are parents, we also understand the value of teaching our children financial literacy skills early in life. At Summit Financial Resources, we believe that instilling positive financial behaviors in our kids will help them grow up to be money-savvy adults.
A study by researchers at the University of Cambridge shows that children can grasp concepts like saving and spending at age three, and by age seven they will have formed their money habits. With this in mind, and in honor of “Take Our Daughters and Sons to Work Day”, we asked our team to share some of the money management lessons they are teaching to the children in their lives.
Lesson: Earn the money to buy what you want.
“Unfortunately, this generation of kids has zero concept of money or the value of it. While many of my kids’ friends seem to get whatever they want and more, my kids have to earn the money for the things they want unless it’s for a birthday or Christmas. Often times this ends up being something as simple as keeping their rooms clean, feeding and walking our dog, or clearing their plates and silverware after dinner. I want to get across the concept of working for what they want, rather than having everything given to them.” – Jeff Dunbar, V.P., Business Development
Lesson: Understand the value of a dollar.
“It’s important that young children understand the importance of a dollar early on in life. We’re teaching our kids how money works and what things cost. For their birthdays, a grandparent will typically give them dollars based on how old they are. This year our daughter turned five, so she received $5. We brought her to the store and let her pick out what she wanted. She chose a toy that cost $10, and we explained that she would have to save up in order to buy it. On the other hand, she realized she could choose a smaller item like a pack of gum and still have money left over.
She decided that she really wanted the toy AND the gum. She was able to buy the gum, put the rest of the money aside, and when she received additional dollars for her birthday, we went back and got the toy. She cherishes the toy that she bought with her own money more than other toys she has. Not only did she learn the value of a dollar, she understood that the other presents she received for her birthday also cost money.” – Andy Disch, VP, Business Development
Lesson: Money comes from hard work.
“I believe kids need to understand where money comes from. Not the sky, not trees, not even from my wallet. Money comes from hard work, and there is really no other source for it. Once my son was old enough to want extra things, he needed to understand that he would have to earn the money to pay for them. I started making chore lists with dollar amounts attached to them so he could earn the money. When he was young, this might mean he could make 50 cents by vacuuming one big room. Now that he’s older, it means he can make quite a bit more by mowing the lawn.
It’s also important to set limits for spending so that kids realize parents don’t have a bottomless pocketbook. Even if there IS extra money for something, it’s okay to say no and let them experience the disappointment of not getting everything they want. Giving them the power to earn the money to pay for something they really want instills a work ethic that will (hopefully) serve them well when they enter the ‘real world!’” – Catherine Goodman, National Marketing Manager
Lesson: It’s never too early to start saving.
“I tell my teenage son it’s all about saving money when you’re young. This is something I didn’t do and, as a parent, I want him to understand how fundamentally important it is. I’m also helping him learn how to budget his money and to only have one credit card to build a credit history.” – Shawn Rockwell, Operations Specialist
Lesson: Invest in reliable transportation.
“For my kids’ first cars after graduating from college and entering the working world, I’ve counseled them to consider leasing an economical new car rather than something used or secondhand. During the first few years of your career, the last thing you want to have to worry about is reliable transportation.” – Ralph Aurelia, V.P., Business Development
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