PTA Coffee Break: Teach money management skills with a simple game

Parents got a fresh new way to approach their parenting goals in teaching children to form a thoughtful and healthy relationship with money on March 16.

Vicki Hoefle, Adlerian therapist, mother of five and creator of Parenting on Track (parentingontrack.com), delighted all present with her down-to-earth, proven method of teaching kids how to spend, save and give away their money.

Vicki’s system is elegant in simplicity and profound in impact. As soon as a child is old enough not to put money in their mouth, she gives “a dollar for each year” each week. That would be $4 for a 4-year-old, $10 for 10-year-olds and so on.

In her family, cash distribution happens at a Sunday morning family meeting, and of course, helps encourage family attendance. At 12, she halves the amount because that’s when children can start earning money doing things outside the home (walking dogs, watching the cat, etc.). At 14, the weekly stipend is completely eliminated. By that time the desire and experience of having money have been firmly established, and kids show themselves to be enormously resourceful when the funds are cut off.

Vicki emphasized the importance of giving kids their allotted money with no strings attached. It is for the child to determine what they want to do with it entirely.

“At first, they’ll give it away to their friends,” then buy too much candy, but eventually they become quite discriminating in what they buy.

When her eldest daughter wanted to buy a Coach bag in which to keep her new money, Vicki’s upbeat response was, “OK!” Only in the store did it become apparent that the Coach bag would require years of saving. (Mom had remained cheerful and mute, on the sidelines.) The kid, on her own, then requested a trip to T.J.Maxx to pick up a cheaper model. Mom hadn’t lectured or fought, or tried to control the situation in any way, yet the kid eventually figured out the unspoken lesson.

Vicki has some additional guidelines. A child should never be paid for chores done in the home, except for babysitting. We can’t be both parents and employers. As parents, we should never deny a child the opportunity to pay for a dinner out. It gives joy to give and reinforces the child’s self-esteem, resiliency and commitment to the community.

Also, the money shouldn’t be “attached” to grades or other behaviors or accomplishments. She emphasized not to loan them money if they forget to bring it, and never to lecture them on their purchases.

As far as giving money away, Vicki encourages parents to talk about the charities they support and why. Ask the kids if there is anything they are interested in supporting, and make some likely suggestions, like helping animals. She shared how after her daughter decided to help animals, she would bring her down to the humane society each week for her to give a dollar of her own money.

Each tiny experience the children have over their developmental years with their own money is part of a subtle-yet-powerful learning process. Parents must allow kids to forget to bring their money, lose their money, and give it to their siblings or do anything else they want to do with it.

Vicki’s only exception was to ban any “isms” from the house. That is, anything that was reflective of racism, sexism, etc. If a purchased item falls into the forbidden “ism” category, then the opportunity arises for a teachable moment. Otherwise, if parents get involved it disrupts the learning process.

Parents sensed the playfulness in this simple approach of letting kids practice with small amounts of money and develop a sense of its true value. A finite amount of money helps a kid prioritize what is of value to them, and thus helps them discover themselves.

Vicki’s eldest daughter is a fashionista, for whom it is well worth the additional money required to get the precise brand, shoe, bag or what-have-you. She uses her value system, not Mom’s. Another kid didn’t even want to spend any of his funds on a wallet, but would bring his money into stores in a greasy, worn envelope and would proudly count out, one-by-one, his purchase amounts — sometimes to the consternation of the cashier. This same child showed great interest in investing and convinced his parents to let him experiment with a fund. With his gains, he was able to take the entire family of seven to South America!

By honoring a kid’s choices, we honor who they are. Each child gets to that great beyond, what Vicki calls the “18 to 80” segment of one’s life, with a sense of the true value of money, confidence in one’s ability to manage it, and understanding of what money can and cannot do, how difficult it is to make and how easy to spend, the difference between “want” and “need,” and finally develop a strong work ethic and appreciation of the life we as their parents provide.

During a question-and-answer session, one parent voiced the concern of many: How can we ask our kids to do homework, sports, be involved in community service, Scouts, church groups and other extra-curricular activities and still ask them to earn money?

Vicki was clear that learning to balance one’s time between competing enterprises is part of life. She referenced research that shows that today’s college graduates are typically low-functioning in areas of budgeting, time management and organization. Learning to balance competing interests is in the kid’s best interest overall, now and forever.

KATE ROGERS lives in Laguna Beach.