It’s okay to start early with the money talk
Teaching kids about money should come naturally, Hannah McQueen writes.
There’s always that one over-enthusiastic parent whose kids start everything early. They’re walking first, talking first and peaking before they even start school.
I am not sure if it’s because, by comparison, I am quite lazy – but I chuckled when a mother emailed me saying she was teaching her child about money early.
How early? Her child was two and a half. I wondered what she could possibly be teaching a toddler that they would understand?
Studies show, however, that as early as three children can determine a difference between rich and poor. They notice what their friends have, especially if it’s different, or better, than what they have.
They don’t necessarily think less of themselves or their friends, but they are becoming aware of difference, and at some point may draw the conclusions as to why it exists.
Does this mean we should be driving our kids through the poorer parts of town to explain why people who work just as hard as we do are struggling? Maybe not.
What we can do is start a conversation about money. Discussing money is one of the last social taboos, but it shouldn’t be. It underpins so much in life.
As parents, we worry we will burden our children or ruin their childhood, reaffirming that ignorance and bliss are natural bedfellows. But when it comes to mastering money, ignorance is never bliss.
After ‘‘when,’’ the next question parents ask me is ‘‘how’’ to start. The answer is simple: you just start.
You don’t have to have ‘‘the talk’’ where you sit down and earnestly intone economic concepts, just introduce it as naturally as you would explain which foods are good for them.
You don’t have ‘‘the food chat,’’ you just chat.
With my kids, aged nine and four, we discuss different jobs people do and different businesses we could start.
We talk about how Mum and Dad go to work to earn money to provide for the family, but that money is limited so we must choose carefully what we spend it on, or it will run out.
We also make sure to mention the ATM is not a magic, endless supply of money!
When my son tells me that rather than go to university, he’s going to move to Australia, buy a yellow mustang and grow a moustache, I ask him how he will be able to afford the plane ticket and the mustang (never mind the moustache)?
With my four-year-old, we play with coins of different sizes and currencies and I remind her that the only coins she can eat are the chocolate ones.
The best financial foundation to give your child is that money is not to be feared or revered, it just needs to be mastered – but not all by the age of two!
Hannah McQueen is a financial advisor and author.