Tuesday, January 22, 2008

Raising Money Smart kids

Raising money smart kids.... that is quite a challenge in today's have now-pay later culture.

I came across a story by a smart parent that shows incredible insight as to the training that goes into the raising of money smart kids. This parent uses the "Kids Wealth Money kits" that we now have in stock on our RaisingEntrepreneursAtHome website

(Just so you know what he is talking about- the plan account recommends 20% of the total Kid's Pay amount be allocated to this account. This fund is used to purchase something relatively costly, like a bike. )

"My wife and I were with our kids, Mike and Meaghan (age 5) at Toys R Us buying a present for one of my nephews. When Meaghan saw her perfect purple Barbie Jeep she said, "Dad, can I have that?"

She tried it out by driving it up and down the aisle.

She was so excited, so she asked again...

"Can I?"

"Of course you can - it's $400 and you can PLAN for it."

"Can get I it now?" she asked again.

"Well, how much do you have in your Plan Account?"

"$50", she told me.

"Well, you need $350 more, and so in seven months you can get it."

I really wanted to buy it for her because I knew she would love me so much if I had bought it right then and there for her. But she was happy just knowing she could get it someday by making a plan to purchase it.

It did turn out that 5 months later, we happened to be in the same store and the Barbie jeep was discounted to $300, and she asked again if she had enough, and this time she did. So off we went to get the $300 from her Plan Account and she bought her Barbie Jeep.

Was she ever proud!

She told all her friends how she planned for it and finally paid for it with her own money. We sold it 2 years later for $150 which she then used towards her next planned item.

Teaching your kids to plan instead of save may be a minute difference in vocabulary usage BUT the outcome difference could be huge.

Anyone can save (well almost anyone) but not everyone can plan. It is a skill that is learned and reinforced hopefully in childhood.

What this can do for a child (and adults as well) is it teaches kids that larger purchases are possible, and not wrong because they are expensive - as long as you can plan for it, (and it is a worthy goal) you can get it.

It allows kids to make personal decisions for things they want to have (with your approval).

Again, the appropriate, consciously used language is key.

Let me ask you to say out loud the following two sentences:

"I want to save for a vacation"

"I want to plan for a vacation"

Now tell me: Which one feels more empowering and motivating?

Saving implies sacrifice, and while some may argue that it is good for kids to sacrifice, I believe it is not necessary to be negative about it.

Rather, if your child wants a bike, that's great!

Let's PLAN on how they can achieve that goal by training them in money smart skills now while they are still in our homes.

There were no such financial helps like the Kids Wealth Money Kits when my oldest two were at home and by the time I discovered them my youngest 2 at home had well gone beyond the need for the beginning stages of these great kits.

They are ideally suited for the 3-4 year old and up to ages 12-14.

But I do recommend them for those ages. They are excellent training for children AND they train the parents on how to train the child. Parents are in the lead here which is what I like the most.

I only wish I had come up with the idea to market my ideas and methods that we used when my oldest were at home.

Click here to check out our blastoff opening sale on the Kids Wealth Money Kits that I will be announcing in about a week from today.