A Quiet Fortune column: A Christmas present for the kids
A Quiet Fortune
It’s six o’clock Saturday morning. The house is dark except for Christmas tree lights. Two of our grandchildren came over yesterday to help decorate, and the night was filled with eggnog and falling ornaments and laughs.
This morning the kids are at home, hopefully still in bed, and I’m sitting here wondering why it is that I always seem to wait so long to even begin thinking about what to get the gang for Christmas. Sure, Amazon can deliver my choices within days, but really, shouldn’t I be at least a little bit more on top of it? If you have kids in the family you know the pleasure of finding just the perfect thing for them. For me, it always seems like something I should have thought about at least a month earlier.
But I do have one idea for parents and grandparents. It is, of course, an idea about saving.
I know … bo-o-oring. Christmas is about so many exciting things: the birth of Christ, winter vacation days, snow, families feasting and being together. But saving? Come on, now.
This present is actually just an idea to give them. It was once an intrinsic part of our culture and character, and it’s a habit that’s easy to develop if it starts young.
By the time your kids reach 8 or 9 it’s obvious that they are growing more independent. They pick the sports they want to play, hang out more often with friends of their choosing, help around the house, maybe get an allowance, know what they like to do in their free time. They can do hundreds of things without your ever-present supervision.
One of those things is to plan what to do with their money. So maybe it’s time for them to get a nudge in a positive direction.
Back in the 1980s defined benefit retirement plans across the nation were scrapped. Suddenly most people had to begin funding their own tomorrows. But a lack of knowledge and/or responsibility regarding personal finance moved at least half our population into tenuous positions. Ignoring the thought of investing for the future has put too many Americans into a real bind. That’s not inevitable for our kids, though.
Parenting experts tell us to teach our children about money when they are able to understand the ideas of sharing, spending, and saving. In my opinion, that advice would be much more robust if we add a nuance to that “save” category to help them distinguish between saving for an immediate goal and saving for the future.
When you have a little time together, ask your kids to get whatever money they have stashed away. Then bring out four jars or boxes. Label the first three: Share, Spend, and Save for Something Special. You’ll have them dump their money out in a minute and divide it in whatever way they think is best. Talk a little bit about the different purposes money can have.
Share, of course, is obvious. That portion might be for friends’ presents or church or a charity, and it helps them become aware of the needs of others. The Spend pile is money to use any time and in any way they want. That’s important too. Even if they spend all of that money foolishly, they’ll get early life experience in decision-making. Save for Something Special lets them take part in working toward a goal in the near future, like that basketball your son might want.
It’s jar number four that is different from what I’ve seen in books by the experts. Label that jar whatever you think is most appropriate: My Future, To Invest, This Will Grow, or Forever Fund. Just having that category can help your kids get into the habit of tucking a little bit of their allowance or birthday money into a place that won’t get spent at all. Someday you can take them to the bank with that bit and start an account that might just become the beginning of a true “forever fortune.”
This one small habit started young and encouraged through the next few years will be a powerful and positive gift for the kids you love. Saving for the future can become a natural part of life.
Now, back to Amazon for me…and Happy Holidays to you.
Terrie Drake is the author of the book “A Quiet Fortune” and a retired teacher and librarian. She and her husband have lived in Glenwood Springs since 1974. She is not a financial adviser; consult a competent professional for your personal financial solutions. She can be reached at firstname.lastname@example.org.