June 19, 2015
A few days ago, while driving my 6-year-old son home from school, he informed me that in addition to being a real estate investor and a policeman, he was going to be an inventor. He went on to describe how he was going to invent a flying car made of gold and then outlined a detailed plan about how he was going to charge $10,000.00 for each golden flying car, but on every Monday and on every holiday he was going to allow people to buy the cars for half off so that he could sell a lot more. It was so cute!
What particularly touched me was the CONFIDENCE he had that he was going to indeed invent a flying car. It was also amazing to see how his little mind crafted such a thoughtful business plan and sales strategy. I used this opportunity to talk to him about steps he could take now to make his dream come true and how he should write all his “business plans” down now so he could remember them later when he grows up. When we got home he really started looking for a notebook! I love having talks like these with my kids! They inspire me.
Talking with kids about money at a young age is extremely important! Why?
1) Kids’ brains are like sponges! The medical term for this is “Plasticity”: the extraordinary ability of the brain to modify its own structure and function following changes within the body or in the external environment. The plasticity of the brain declines as we age; therefore, it is essential to have these talks with our kids now! At this tender age, we must teach them financial responsibility and solidify the notion that they can truly do anything they set their minds to!
2) Poverty is a significant determinant of child health. Poverty disproportionately affects families of color and poverty shortens your lifespan. According to the American Academy of Pediatrics: “Children living in poverty are at high risk for poor academic achievement, high school dropout, teen pregnancy, drug and alcohol abuse, criminal behavior and exposure to “toxic stress” with subsequent negative physiologic and development effects. Children living in poverty have decreased access to quality healthcare, worse health outcomes, and are at greater risk for developmental delays, asthma, ear infections, obesity, poor nutrition, abuse and neglect. Families living in poverty experience higher infant mortality rates. To interrupt the cycle of poverty in our generation and its ramifications, we must tart teaching our kids NOW how to break it.
Here are the top 10 tips I’ve learned over the years regarding teaching/talking to your kids about money:
1) Be a good example with your own personal spending habits. They are watching you!
2) Open a savings account for your kids college fund and periodically show them the balance.
3) Include games like Monopoly into Family Game Night.
4) Provide them with a weekly allowance (no matter how small) and use it as a learning opportunity to teach them about saving vs. spending.
5) Find a balance between sheltering them from stressful financial hardships in the family and be honest with them regarding the realities of living on a budget.
6) Add the word “entrepreneur” to their vocabulary at a young age! Teach them to strive for more than just doing well in school, going to college, and working for someone else their whole lives as our generation is generally taught. Tell them they can be their own boss if they want!
7) Incorporate short talks about money into your everyday activities (ex: filling out withdrawal slips at bank, paying cashiers at stores, paying monthly bills, leaving tips at restaurants, etc.). Within reason, let them make small financial decisions with you (ex: How much should we spend for Grandma’s b-day gift? Should we buy the $10-dollar bowl or the $50-dollar bowl?). If you are a business owner yourself, let them pretend to make business decisions with you (ex: How much should we charge for this product? How much should we charge to rent out this apartment? Etc.).
8) As a family, pick out a charitable organization to donate to monthly and allow your kids to learn the importance and power of using money to help others.
9) Continuously initiate and have open conversations with them about their own dreams and visions. Make them believe they can do or be anything they want to! Be their biggest fan!
10) And most importantly, always emphasize the importance of memories, friendships, family, and love. Money isn’t everything and there is so much more to life than big houses, fancy cars, …and full piggy banks.
What strategies do YOU have for talking with your kids about money? Share them with us on www.facebook.com/browngirlgreenmoney so we can post them!
Let’s get the conversations going! Our kids are our future! Let’s teach them to break the cycle of poverty, eliminate racial economic disparities and reach their dreams! Thanks for reading! Have a great day!
Jasmine Zapata, MD is a pediatrician, motivational speaker, public/preventative health advocate, mentor, mother, wife, and entrepreneur from the Madison area, whose mission is to heal, uplift, empower and inspire. She can be reached at www.facebook.com/drjasminezapata or at email@example.com.