EASTER EGG HUNT
Before we start, I believe it's important to have a philosophy about big picture issues like money. Here's mine:
Most schools are focused on educating our children so that they can get jobs that create good incomes. That is a good thing, as far is it goes. But income is not wealth. Wealth is capital. Income is merely affluence. And there are a lot of affluent people that are broke.
Let's talk about some things that will help your kids avoid that problem.
This is a really cool idea and it was born out of my desire to get my own kids to stop drinking so much Coke when we went out to dinner. Wendy and I aren't big drinkers, but we love Coca Cola and our children adopted our bad habit. "Kid's" I'd say..."if you will order water with dinner instead of a Coke, I'll give you a dollar." My son was 8 years old at the time and my daughter was 15. Habits were hard to break for my daughter, but my son, he went for it.
And then I saw the possibilities.
After I gave him the dollar, I said "Jon, I have an offer for you. If you'll give that dollar back to me so that it goes into savings, I'll double it!" And he did. Over the years, he'd hand me back some of his chore money and I'd match it. And then he would make a little money raking a neighbor's yard or mowing grass and would save some of it...and I'd match it too. It added up to thousands of dollars over the years.
When he turned 16, Jon bought a car with that money. He was incredibly proud of himself. I was (and am) proud of him, too.
The family 401(k) is a great way to get kids to save. Start early though! Buy two clear piggy banks that have to be broken to get to the money. Label one with your child's name and the other as "Parent Contribution". Put them both in a visible place and make a show of adding money to the accounts. Make sure to keep a running tab on how much is in them. It's fun and it makes for fond memories. And the kids learn the habit of saving money!
By the way, as the kids get older, you can take the money to the bank or invest it. When the kids are young though, I believe them SEEING the money is important.
I believe in helping kids develop a good work ethic and chores are a way to do that. But chores don't necessarily teach kids about money. So how can you combine the two? Make a chore that involves shopping. You can start by bringing the kids with you to the grocery store when you're just making a quick run (milk, bread, maybe a little ice cream, root beer, etc.). Give them $10 or $20 and tell them what items you want...but not necessarily the brand...and have them run around the store to buy them. Let them know that they need to pay attention to the price because they get to keep whatever change is left...but that they also need to eat what they buy.
Their math will improve quickly and they'll start looking at the cost and quality of things. And they'll look for deals.
Wendy and I have some friends in Charlotte, NC....the D'Amato's...that have a neat little twist on this idea. Whenever their kids want a game of some kind, the D'Amato's make the kids pay half of it. The results have been impressive. Their kids tend not to buy brand new games at the highest price. They wait a year and get them at a 50% discount. Delayed gratification can make for great financial benefits.
You can do some creative things around the holidays and one of my favorites is an Easter egg hunt. Except don't use real eggs. Use the pastel colored plastic ones. Inside, place silver dollars.
You can tie a little work into the big hunt by placing several silver dollars into one egg and requiring that a task be done in order to earn it. If you make this a neighborhood thing, you'll be amazed at the number of kids running over to sweep your porch or driveway. Make sure to set a time limit. It makes for good drama! The child with the most coins wins a big chocolate Easter bunny. The kids keep half their treasure (and maybe half of that goes into the family 401(k)). They give the other half to charity.
CHORES...WITH A TWIST
I mentioned earlier that I believe in the importance of helping others less fortunate. It's not a Republican, Democrat, conservative, or liberal ideal in our family...just a value that we want the kids to have. So how can you foster it? Put together your own version of a Family Foundation.
You don't need millions of dollars...you can do it with a few thousand. There's something called a donor advised fund that you can use (just email me if you want to know more). The money going into it is generally deductible. In my family's case, we put money in every year. Every quarter, we decide as a family what organizations we'll donate funds to.
The benefits of this are (1) I like the family culture it creates towards giving and I like to think that when my kids have kids, they'll make this a family tradition, (2) I like how it allows us to learn about the organizations we give money to...a "due diligence" kind of thing, and (3) it allows us to tell those soliciting us for money how we make contributions at the end of each quarter.
FAMILY FOUNDATION...OF A SORT
When the kids are in middle school through college, have a family night and play one of Robert Kiyosaki's cash flow games. If you don't remember him, Robert's the guy that wrote the "Rich Dad. Poor Dad." book that was so popular a few years ago. His games teach players the importance of cash flow and expense management in a "monopoly on steroids" kind of way. It is fun to play and our kids liked it. And again, it brought us together over the kitchen table rather than the TV.
I hope you like the ideas presented here...and let me know what neat ideas you use in your family! I'll make sure to share them with others!
Entrepreneur, financial guy, husband and father of two great kids.