In today’s financial crunch, if you haven’t sprung into action to sharpen your child’s money smarts, I’ve found some pretty useful tools to help you (parents/guardians/grandparents/educators/mentors) widen your financial purview.
A few days ago my boss hipped me to the Money Savvy Pig, a nifty, wide-eyed, blue boar with four chambers that’s unlike the traditional one slot piggy banks.
This 21st century pig is light years away from my brown glass pig my brother used to raid. Each chamber is embossed with its purpose on the side: save, spend, donate, and invest, and it’s this concept that makes it a prize hog. Instead of only teaching your children about spending wisely and saving thriftily, it broadens the scope to two additional options they have with their money—donate and invest.
It’s a bit hard to fathom, but when you break it down, there are only four choices we all have with money—save, invest, spend, and donate (though, at times, it seems my money is doing none of the above). This pig presents those options to children and lets them decide—with parental guidance—what they should do with their money.
Savvy Pig inventor Susan Beacham also runs a money blog, which offers personal finance tips for parents to share with their children. The piggy bank, the blog, and a money pamphlet, which is included with the pig, are all great ways to give your children concrete, hands-on lessons when it comes to money.
I had the chance to speak with Beacham and she made some extremely insightful observations about teaching young people about money.
“When you work with children, you begin to realize that money is an abstract concept to them,” she says. “If you want them to learn, you have to take every concept and make it concrete.” Because children are visual learners, simply telling them the virtues of saving and the value of money management isn’t enough—they need to learn the cause and effect.
Along with the piggy bank, one of the clearest ways to teach your child the benefits of saving is to tie life goals with financial goals, a piece of advice I received from financial planner David Hinson a few months ago. In other words, establish why you are saving, i.e. for a down payment on a house, a new car, or vacation.
For children, instead of purchasing that iPod, let the purchase be a savings goal, and each week they can measure their progress. This way, the fruits of their labor will be more tangible and they’ll be likely to appreciate the iPod that much more.
Of course, with every good product there’s at least one drawback, and at $14.99 this pricey pig might set you back a bit. Cost wise, it is in line with piggy banks at large discount retailers such as Target and Wal-Mart. But a quick search for plastic piggy banks online yields a number of hogs $3 and under. Purchase four of those things, and with a quick do-it-yourself labeling—voila, you have your own multi-storage-snouted money drove.
Tell your story: How have you worked to teach your children, nieces and/or nephews, or young people in your community about money management?
Renita Burns is the editorial assistant at BlackEnterprise.com.