Teaching the Value of Money

Many thanks to Viva Magazine for permission to reprint this article from my March column.

As parents, we teach our children about a multitude of things including about money.  One very important key in teaching children about money is the concept of value.  What we purchase is what we value.  What we charge for a service or for the products we supply is value.  It is an exchange.  Teaching our children this concept can also be an eye-opener about our own beliefs about money!

A child can gain valuable experience working with money through an allowance.  Some parents require a child to earn his allowance through chores.  With the agreement that we have in our family, our daughter receives an allowance from which she purchases her “wants.”  She has unpaid responsibilities – folding clothes, feeding the pets, taking out the trash – as well as special chores she can do to earn money, such as washing the dogs.  She also has bake sales with her friend, and from their profits they purchase the supplies for the next sale.  Their first sale was funded by us with repayment made in cookies – a high value return on our initial investment!

Jane Cabrera of Center for the Advancement of Families (www.CAF4Life.com) teaches a course called Money Freedom™.  Jane, the mother of two teens, notes that “many of us learned in childhood that our value was tied to our ability to make money and contribute financially.  When an individual suffers some form of financial cutback, there is often residual suffering due to a belief that their value as a human being has diminished.  This is simply not true.  In raising our children, it is important to communicate to them that as a human being, their value is immeasurable and changeless.  At the same time, it is important to share strategies on the management of money, products and services as it is an important life skill.”

Children learn from what they see.  When a child observes parents seeking and providing value through an exchange of money, practicing strategies for money management, and talking openly about money rather than making it an unspoken secret, he learns the value of money.  He also learns that his value is much more than money.  This will serve him for a life time.