Smart Money, Smart Kids

Teaching Our Toddlers the Value of a Dollar

In the world of personal finance, some lessons are learned too late, like when I naively signed up for my first credit card as a college freshman. What if we could equip our children with these vital life skills from the start, preparing them not just for the financial world but for the broader adventures of life? This story begins with two young characters: my 3-year-old and 5-year-old, embarking on their own financial odyssey.

It started innocuously enough. Every trip to Target became a chorus of “Can you buy me this?” followed by a crescendo of “And this? And this?” It dawned on us that something was amiss. While we were fortunate enough to provide for our children, we didn’t want them to grow into stereotypical spoiled brats, blind to the value of money. Besides, our living room and basement, doubling as a playroom, were already drowning in a sea of toys.

Our solution? A job and a weekly paycheck for our toddlers; a departure from the usual allowance system where kids receive money regardless of effort. Our expectations were age-appropriate: picking up toys/ clothes and putting away dishes. My wife, the more stringent of us, even taught them to sweep up their food messes. This wasn’t just about cleanliness; it was about instilling responsibility and the idea that effort reaps rewards.

Weekly wages shown on our refrigerator

Every Saturday (although sometimes I forget and must make it up the following week), I play the role of the benevolent employer, reviewing their ‘work’ and dispensing their earnings of $6 each. Yes, it might seem high for toddlers, but here’s the twist: we introduced them to the concept of investing and charity. Half of their earnings ($3) go straight into their TD Ameritrade investment accounts, planting the seeds of financial growth early. Another $1 is donated during church services, fostering a sense of generosity and community responsibility.

The remaining $2? That’s their spending money, managed through a Till Financial debit card. This transforms every shopping trip into a practical lesson in budgeting and decision-making. (Sign up for Till with my referral code and earn a free $25!) Our daughter has already purchased a see-through backpack, while our son got a toy pizza, a remote control centipede, and a Transformer. It’s more than just buying toys; it’s about understanding the value of money and the satisfaction of earning and spending wisely. Now our son enjoys checking the price tag before asking to make a purchase.

These small steps, these little lessons about money, are our investment in our children’s future. We’re not just teaching them to count coins; we’re instilling values and skills that will serve them for a lifetime. In a world where financial literacy is often learned through the hard knocks of experience, we hope to set our children on a path of informed, responsible financial decision-making, shaping not only their futures but potentially the financial wisdom of generations to come.

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