Turn Your Kids Into Financial Champs

Turn Your Kids Into Financial Champs

Tired of must-have-that-toy-right-now tantrums as you walk down the aisles of Target or Toys “R” Us? In her new book, Earn It, Learn It, Alisa Weinstein tosses the old allowance-based system of teaching your kids about money and replaces it with a novel concept: Introducing them to a variety of careers at a very young age.

Innovative learning lessons can transform a child's life. I remember sitting down with my dad, who showed me how to calculate how much money I'd have in my IRA down the road if I contributed my babysitting and lawn mowing money.

Once I realized that I could have a million dollars if I saved $2,000 a year (the annual max contribution back then) for 50 years and earned 8% average annual returns, I was hooked. It changed my attitude about money forever, and learning to be responsible became fun.

In an interview with the author, I got her thoughts on why accelerating kids way beyond their years just might turn them into financially responsible wunderkinds.

LearnVest: How did you come up with this concept of using jobs to teach kids about money?

Weinstein: I credit my daughter completely. She wanted, “one more lip balm, Mommy!” while I thought 13 lip balms were plenty for a four-year-old. In my exasperation, I told her to “get a job.” As soon as I said it, I just knew that that was how she was going to earn her allowance: by test-driving real jobs.

How does Earn It, Learn It work?

For the book, I interviewed 49 people with 49 different careers. I then translated their day-to-day responsibilities into kid-friendly tasks, many of which take 15 minutes. So when Mia was a toy designer, she cut out a paper version of her favorite stuffed toy and we talked about things like hard costs (which she apparently doesn’t have because, as she said, “Mom, I don’t pay for [that stuff]—you do!”).

What is the most surprising reaction you've had so far from a child?

I say this with a big smile: The most surprising reactions don’t come from kids. The real surprise reactions are from parents, who didn’t realize it could be so easy—and take so little time—to get their kids engaged in something totally worthwhile.

What is the most common challenge parents have today when teaching their children about money?

It has to be just getting started. Talking about money makes people uncomfortable. On top of this, the traditional methods (paying for chores, odd jobs, or no strings attached) aren’t much fun. Since we’re all so busy, it would seem easier to avoid the subject altogether. But then you end up with a kid who thinks the world exists to provide her with another lip balm.

What have you personally learned about money while writing this book?

I was lucky. My parents taught me early on that what we do to earn money can be even more valuable than the money itself, which means being more open to finding a career that simply makes us feel good. And this not only makes life richer, it makes living with (and learning about) money a lot more fun.

 

 

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