Talking Money with Kids

By: David Smyth, August 2, 2018

This month, we're going to be talking about kids and money, and while there are all kinds of statistics out there about how much it costs to raise a child, we're not going to worry about that today. Instead, I want to get down in the weeds of talking about money with my kids. Some of you may remember an article we wrote a while back about using technology to teach children about budgeting and banking. Read it here for a refresher.

Now that my boys are 13, 10 and 5 years old, they're all mentally accustomed to the fact that every week, on Sunday after church, they get their age in allowance dollars. That's when the banking app they use automatically updates their accounts, and like all good American consumers, they do their best to spend it! I used to loathe the fact that they always wanted to talk about their money on Sundays. My mom always referred to that day as the Lord's day, and I was brought up to relax (and watch the Seahawks!) on Sundays, and it wasn't a day when finances and budgeting were to be discussed. 

Fast-forward to today's world though, and from my perspective Sunday afternoon is as good a time as any for my kids to ask money questions - they're around, and I'm not at work. But there are limits to Dad's willingness to talk about money, and there are things I'm setting limits on when it comes to their money and expenditures. 

For example, Ridley, the middle child, knows exactly when "it's payday for me!" as he says. He'll often come to me and ask how much money is in his account. Twenty-two dollars, I tell him. Then he'll say, "Dad, now that I have $22 in my account, I'd like to give $10 to Gates." Hm, I say, why are you giving your money to your brother? To which Ridley replies, "Gates will talk to you about what he's going to do with it." So, I say okay and transfer the money to Gates. Ridley is making decisions, and it is his money. (And hats off to Gates for convincing his brother to fork over his allowance!)

Then there are other times when we're out shopping and Ridley asks, with a zap gun in hand and bang-bang gun in the other, how much money he has. Eleven dollars, I tell him. Then his eyes get wide and he says "Oh my gosh! These are only $5 each! That means I can get a set!" So he puts away the zap gun and buys a second bang-bang gun. Just when I think he's on the verge of conquering the world, he reminds me that he's still a little boy. 

Then there's Michael, the 5-year-old. Every now and then, he'll come up to me with his iPad and the Thomas the Train app pulled up, and say "Dad, I need this train! Do I have enough money to buy it?" I'll tell him he does, but for $5 he could buy all 16 trains instead of spending $1.99 on that one train. "But I don't want the other trains," he says. "I only want this train." Folks, this is not a kid who's going to shop at Costco. He'll be Whole Foods all the way! 

Another Michael story - the kids and I recently went on an ice cream tour of Lexington. We visited Sav's, Crank and Boom, and Steel City Pops (after Graeter's and Baskin-Robbins the day before of course!) I told the boys they could have one scoop each because we'd be tasting more. After literally one taste, Michael says, "Dad! I have a question! Do I have enough money to buy another scoop? Because I really like this ice cream!" I smiled, lied and told him no. I pride myself on being straightforward with my kids, but sometimes I have to protect them from themselves. 

And then, there's Gates, my 13-year-old, who reminds me that he's a teenager every chance he gets. He wears it on his sleeve, and apparently thinks it's a license to sleep as late as possible, and then stay up as late as his eyelids will stay open. He's caught the very-contagious teenager-itis, you see. When he's done his chores and he knows there's money in his bank account, Gates will slyly send me an I-love-you-Dad text, knowing that his dad, whose love language is words of affirmation, will bite hook, line and sinker. This is when Gates goes in for the kill by sending an app request, or a purchase request for $25 in V bucks for his Fortnite video game. (In case you're under rock, read more about the $1 billion Fortnite here.)

At this point, all the wind leaves the "I love you" text as I realize I'm being used! By now, Gates also knows that I won't approve these requests on Sundays, or during work (read: school) hours. So, it's a game of him waking up early enough to get them in before work, or after school but before dinner. 

When we do talk about these purchases, I ask him why he wants to waste $25 on Fortnite. He looked at me with mild disgust and proceeded to enlighten his "old" dad that it's not, in fact, wasting - it's an investment. "Oh? How so?" Gates then informs me that he's using the money to buy limited edition "skins" (clothes) for his player, because people will buy player IDs on eBay for hundreds, or even thousands of dollars if they have all the gear (weapons) and skins. So, he continues, this $25 means he'll have spent $125 total on his player, which he plans to sell for five grand in a year or two. Then he gave me that "what do you think about that?" look - if you have teenagers, you know it well!

Quite frankly, as I thought about his logic in putting money into something he planned to try to sell to someone else for a greater value, I had to smile. Maybe I've got a little business man here, and there's hope for the future after all! I told him I'd approve the request, but that only time will tell whether or not this is a "good investment."

What funny money stories do you have with your kids? I absolutely love hearing my boys talk about their thoughts on these topics, and I'd love to hear your stories too. Drop me an email!


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