Managing money doesn’t come naturally to me. Maybe because I’ve never had much of it to manage-not enough hands on experience. If I had a dime for everytime someone said “don’t let that money burn a hole in your pocket”, well, it would all be gone because I’d have spent it. After several years of marriage I turned the burner down a few notches and learned to save. Not much, but I had to start somewhere.
I keenly remember my best friend’s unfortunate circumstance as a child; save half of every dollar he received. My pre-pubescent mind reeled at the thought of all that money going to waste by sitting there. I was thankful my parents never imposed such a silly restriction on the meager funds I collected on birthdays and holidays. When I moved to Virginia and started cutting grass a steady clientele translated to hundreds of dollars over the course of the summer. By the time the grass stopped every penny was gone.
Things weren’t much better when I started my first “real” job working on a golf course. For one miserable month I woke at 4 AM to drag myself across town and cut tee boxes and greens. After hitting all 18 holes I finished my day doing random clean up work wherever it was required. After a month I had a grand which I promptly spent on a Hartke bass amplifier. Then I quit.
Over the years I’ve managed to reign in my spending habits to some degree, occasionally going off on a spending spree. Those days are far behind me and I’m glad to say my credit score is respectable. I contribute to my 401K and started a Roth IRA several years ago. I’d love to save more but on a single income it’s not feasible.
Before Penelope was born Jenn and I discussed whether or not one of us would become a stay at home parent. We didn’t know if it was financially possible. I conversed with friends and co-workers, asking “just how much does it cost to have a child?”. Everyone had the same answer; “I don’ know but somehow you always have enough money to get by.” As unsatisfactory as the answer is I’ve found it to be true, up to this point. Money previously spent going to a movie or buying a CD on release day now goes to diapers. Jenn and I have never been frequent restaurant patrons, but our current outings for a meal qualify for Special Event status. That money also goes towards diapers.
I preface my next statement with a firm belief that parents have to decide what is best for them and their family. I do not believe there is a universal answer to the question “Should I stay home with my baby?”. For us, the answer was for Jenn to stay home until Penelope was old enough for school. We did everything we could to prepare living on one income. It hasn’t been easy, however Jenn and I felt we couldn’t put a price on bonding with Penelope. We had no idea if she would be withdrawn or exuberant, receptive to a strangers love or understandably cautious. Jenn worked part-time before we left for China, so it was her decision whether to quit working and stay home. Either way I would support her. Ultimately she turned in her notice a few weeks before we departed.
When Penelope received her first cash gift I remembered my neighborhood friend who lost half his “income” to savings. I don’t recall him complaining about it; he understood there was no choice in the matter. He was conditioned to the fact that a $10 dollar gift from the Easter Bunny was actually $5. If he had a windfall of $50 he knew $25 was off limits and the other $25 was fair game for legos or Transformers.
Penelope has an envelope, soon to be an account at the local credit union, with a little money in it. By the time she turns five Penelope will have more in savings than Jenn and I do. Every time she gets a gift of money half goes to savings. As she gets older we’ll renegotiate the percentage.
When Penelope is older she’ll be sitting down with me to pay the bills. This is something neither of my parents did. I don’t think it crossed their minds. We’ll discuss finances and investing. I’ll encourage her to wait 24 hours before purchasing something, just to be sure she wants it. Maybe we’ll even sit in her room and talk about how much some of her belongings cost and if it they were worth it in the long run.
Every time we visited Stephanie and Charlie’s house Penelope played with a toy cash register. Thick plastic coins are inserted into corresponding slots and a button pushed to make the token disappear. A crank on the side causes a bell to ding and the drawer to open, allowing the young shopkeeper to collect the coins. Now it belongs to Penelope after Stephanie and Charlie graciously gifted it to her. That is the ultimate financial lesson I hope Penelope learns; giving. First to be successful and responsible with money so she has enough to help others.
I feel like there is so much more I could pass on to Penelope when it comes to money and finances. So I ask you dear reader, what are you teaching your children about money management? What age did you start discussing money with your children and how did you do it?