Dear Grandparenting: From time to time I like to give my grandchildren a dollar or so because that’s what grandparents do. My grandkids are at the age where dollar bills seem like a big deal.
How can I best turn this into a teaching moment about the value of money? I’d like to give my grandkids something to think about, and I definitely have their full attention when I open my wallet.
It all boils down to this: How do you teach small grandchildren to become smart with money? With this crazy economy they surely will need it. Tanner Branch, Battle Creek, Michigan
Dear Tom: Yours is an excellent question in any economy. Why stand by while some knucklehead puts bad ideas in their head? Teaching your grandchildren a thing or two about money management might save them from tripping over the same financial traps that ensnare so many grown Americans.
Recommendation number one: Start encouraging the critically important skill of delayed gratification — the very nemesis of a credit card industry that begins marketing pre-approved cards to youngsters trying to get the hang of being a teenager.
To tame impulsive grandchildren, you might offer to give them three dollars instead of one, providing they are willing to wait another week — a whopping 200% increase. Insist they write down their “wish list” and agree to wait 48 hours before buying anything. The urge often passes.
Giving grandchildren a sense of financial ownership can work wonders. Give them $5 to spend no strings attached, and they prefer to pocket it all. Now you can begin to discuss savings, which leads to planning and budgeting.
It’s worth remembering that people perceive and treat money differently, often depending on what form it takes. Your grandchildren might hang onto a five-dollar bill because it’s perceived as having greater value than five one-dollar bills. Hanging onto money is the whole idea. Any grandchild can get the hang of spending. Saving is a skill.
Grand remark of the week
Ginger Jones from Sidney, Ohio thinks her grandchildren “must be magicians, because they change me from being dull and boring into this person doing goofy stuff, like rolling around and giggling with them on the floor.”
