Basics of Money We Can Learn From Kids


As part of becoming a personal financial counselor, I had the privilege to teach the financial literacy program, “Money Management” to the Girl Scouts of Southern Arizona Cochise County for two years. I entered this teaching opportunity naively thinking I would teach these young girls about money. Ultimately, these girls reminded me of the basics of money. A subject that we have simply forgotten.

Here are two things you can learn from them too:

What is a need versus a want?
The Girl Scout Brownie Curriculum says a need is something you must have to stay healthy and safe. A want is something you enjoy and want to have, and is not a need.

This was easy subject matter to teach children. They understand they need food to stay healthy and a home to stay warm and safe. However, according a blog called “The Secret Shame of Middle Class Americans,” adults have forgotten this over time. This blog asked individuals whether they could come up with $2,000 within 30 days for an unanticipated expense. Slightly more than one-quarter could not, and another 19% could do so only if they pawned possessions or took out payday loans.

The conclusion: Nearly half of American adults are financially fragile and living very close to the financial edge. Households are living paycheck to paycheck, or in other words, beyond their means. Have we forgotten this basic concept?

One girl scout’s solution: ask yourself when you go shopping, “Is it a need or a want?” If it’s a want, maybe it can be saved for another day, or perhaps a birthday or holiday gift of some sort. Too often, we fulfill our wants, leaving our needs to be tightly met by a small amount of remaining funds.

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What is a savings account?
According to the Girl Scout Money Management program, a savings account is used to deposit money in a bank and earns interest over time. The purpose of this account is to save money that one does not need for daily use. This account is the easiest account to open because of its simplicity.

When I asked the girls if they owned a piggy bank, all the girls’ hands went up and they described their piggy banks to me. Some owned a butterfly, a frog, and one even owned a hippopotamus. While a piggy bank is not a savings account since it is not growing interest, it teaches children the importance of putting money away for use later. A recent Forbes.com article said 63% of Americans don’t have enough savings to cover a $500 emergency. This means that families are resorting to charging to a credit card or borrowing funds in order to meet the cost of the unexpected event.

Why do children grasp the concept of money, yet, as adults we decline to follow the very basics of money management? We are the example for our children and yet we allow instant gratification and fulfillment of our wants to get in the way of our savings. Next time you take a look at your shopping list, take a moment to take a step back to basics! We are our children’s most powerful teachers on how they will view and manage money, learn a little from them as they learn a lot from you!

Have you learned any money tips from your kids? Leave us a comment and share it!

Cynthia Giesecke is a candidate for the Association for Financial Counseling and Planning Education (AFCPE), a Girl Scout Money Management volunteer and part of the “Military Family Matters” blog team for NMFA

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  1. 1
    Laurie

    I think it is important to teach children the value of money and how to save. But, sometimes they either remind us certain lessons about money or teach us a thing or two along the way. Great post, thanks for sharing!

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