The kids are alright, I guess
Teaching little kids about money is really about values.
Doug here, ready to share with TJA readers how group of 8-year-old girls almost broke me. Instead, I wrote about it.
Last spring, my daughter’s Brownies troop leaders asked if I would teach a lesson about money to an adorable (but rambunctious!) group of second graders. “Absolutely!” I replied, knowing very well there was only one answer to their question. The troop leaders gave me three weeks to come up with a presentation worthy of earning the troops their “money explorer” badge. It has a cute little piggy bank on it.
I spent the next few weeks racking my brain over the lesson. What would I teach them? Budgeting? Investing? The finer points of options trading? Would it even matter what I taught? Would they even care? A game! Who doesn’t love games? Kids loves games, I thought. So, I decided to make one up. What could go possibly go wrong? “You got this!” I told myself.
When I arrived at our town library, the troops were patiently waiting, giggling and skimming money books for kids. “What’s in that bag?” one of the troops asked me. They screeched with excitement as I removed Ziplock bags filled with miniature marshmallows. “Today, we’re learning how to save and invest,” I told them. Their enthusiasm waned.
I went on to explain the rules of my game. Each girl would receive a bag containing 50 mini marshmallows. This was their money. I told them they had one of three choices to make. They could either: enjoy their marshmallows immediately; save their marshmallows until the end of the meeting to receive a second bag of regular marshmallows; or they could invest their marshmallows by choosing one of three companies they’ve probably heard of. Depending on which investment they chose, they would either receive nothing, a bag of full-sized marshmallows, or a full-size chocolate bar at the end of the meeting.
As the girls thought about their decision, I tried my hardest to provide as many lessons around money as I could. They had questions—lots of questions. However, it didn’t take long before their questions turned to mild-mannered chaos. Some started sneaking their marshmallows, making their decision very clear. A few girls played it safe and patiently waited to collect their second bag of treats at the end of the meeting. My daughter and her friend decided to invest, making everyone jealous when they received chocolate bars at the end.
Did we have fun? Yeah, we did. But did they learn anything about money? I’m not so sure. At the end of our lesson, I asked the troop what they took away from the money game. The answers varied, to say the least. A few of the girls seemed to have grasped a concept or two about saving, but for the most part, my little game was lost on them. The sugar didn’t help, either. On our way home, my daughter looked at me and said, “Thanks for trying,” as she snorted at the little piggie on her new troop badge.
I couldn’t stop thinking about the meeting over the following weeks. I wanted to know where I went wrong teaching kids about money. The more I thought about it, the more I realized that the concepts I presented probably required a level of brain development that wouldn’t occur until the girls got a little older. After all, money and financial concepts involve abstract thinking and numbers and systems, which are far from intuitive for the young minds of second graders. I also failed to recognize just how different maturity levels in young children can be. Looking back, the troops weren’t all on equal footing, and I didn’t take that into consideration when planning my presentation.
So, if I could do it all over again, what would I have done different?
Instead of jumping right into financial concepts, I should have focused on values, because they’re the foundation on which financial literacy can be built. When children develop core values, they can use them to acquire skills to make the right financial decisions in the future.
For instance, honesty plays a critical role in managing money—whether it’s being truthful about spending habits or accurately assessing your financial situation. Patience, another important value, is essential for understanding delayed gratification, a concept that underpins saving and investing.
Taking a values-first approach also helps children better grasp the principles behind making financial decisions. The concept of fairness, for example, can help a child understand why it’s important to pay for what they use, whether it’s a toy or a service. A sense of responsibility is crucial when it comes to managing an allowance or even learning the importance of budgeting.
When children practice these values in their daily lives, they develop habits that are directly transferable to financial behaviors. A child who understands the value of hard work is more likely to appreciate the effort that goes into earning money, and therefore, might be more careful with their spending later on. At the same time, a child who learns about generosity might be more inclined to share their resources or support charitable causes.
Teaching values creates a strong moral compass that guides decisions. Before children can fully comprehend complex financial concepts, they need to have a solid understanding of right and wrong, fairness, patience and the importance of making thoughtful choices. These values will not only help them manage money when they are mature enough, but it will also just help them in life.
The next time I’m asked to teach a lesson about money, I’ll start with the basics. Because once children understand the “why” behind their actions, the “how” of managing money becomes much clearer. And perhaps, with a little patience and the right approach, the next group of Brownies might just walk away not only with a badge but with some life lessons that will stick with them long after the marshmallows are gone.
Readers with kiddos: Have you tried to teach them anything about money? Do you think you succeeded? Email us what worked or didn’t.
Right before school started, we spent a week at the Jersey Shore renting a house with our close friends and their two girls. All parents have their own routines and rituals with their kids, which can make vacationing with other families a bit hairy. But thankfully, we jive so well that it truly felt like a vacation. We were also totally on the same page with our financial expectations: the types of restaurants we wanted to dine in; how we’d manage groceries for the house; when we’d splurge and treat the girls to presents. Some of this stuff we talked about and other stuff, we didn’t need to. Making sure you’re aligned with other couples you travel with will save a lot of headache, and potentially, some unintended costs. That’s Ruby and Hazel on the right, contemplating the long-term impact of Doug’s marshmallow lesson.
What we’re reading:
“Mommy, Can We Go to Paris?” - The Cut
You Weren’t Supposed To See That: Secrets Every Investor Should Know - a new release by the GOAT and Doug’s friend, Josh Brown
We still need a few couples for our book on love and money!
SUPER SAVERS, this call’s for you! Are you people who just love sitting atop of a mountain of cash like Scrooge McDuck? We’re kidding, but we do need to speak with couples who love cash and hate risk. You can be anonymous, of course, but we need you! Please reach out!
Clever and thoughtful game to educate the little ones on the basics. Know your audience - awesome !
Thank you for sharing this story and for your candor. Teaching young kids about money can be difficult especially when it comes to abstract ideas like investing. Did you bust out the rule of 72 (kidding)?
I find with young kids it's really about values (like you mentioned) and behaviors - recognizing needs v. wants, delayed gratification, goal setting, being charitable, budgetting,etc. These are the things that they can take into adulthood. If you end up doing another money lesson for the girls, please reach out to me for a save, spend, and Give piggy bank. Happy to send you one to help illustrate some of these core financial literacy concepts.