Teaching My Son About Money Management

IMG_3814Fatherhood is nothing short of amazing and is extremely rewarding. Every moment with my son Ethan is an opportunity for the two of us to bond. Even when he’s sleeping, I pray over him and take this grand opportunity to give him the kisses that he denies his father when he’s awake. lol He wants the world and he certainly deserves it. He excels in school, helps with cooking and cleaning, he’s respectful to his parents and everyone else. GOD I love this kid! lol

He doesn’t ask for much… a gumball here, a toy there, pizza, etc., but after exposing him to things like Times Square and all it has to offer (i.e. Toys R Us, House Of Wax, Movies, Pictures with every cartoon character you can think of, etc) his desires grow and so do the expenses. He’s 6 years old but very independent and is very much a go-getter. He receives an allowance every Friday (granted his behavior during the week permits it), and for awhile he would let his money sit inside of a piggy bank collecting dust while spending all of Daddy’s money.

Well I figured, it’s time we start figuring out what to do with this money once and for all. We emptied out the piggy bank and counted every penny. His smile lit up as I exchanged all of the coins for a $20 bill, $10 bill, $5 bill, and some $1 bills. He managed to save up $37 from his allowance and immediately wanted to get to spending it. I thought this would be a good time to teach him the basic principles of accounting. We created a balance sheet and he learned what debit, credit, and balance meant.

His mom then brought to my attention that he had purchased $46 worth of movies on grandmas cable without permission. Ahhh his FIRST real bill! “This is going to be a great life lesson for him” I thought to myself. We put $37 in the credit side of our account, and $46 in the debit side of our account, leaving the balance $9 in the negative. Right before his eyes he saw his “life savings” disappear. He was in tears and was heart broken over the loss.

I explained to him that it’s only money and that you will earn more and when you do, you need to manage it better. You will be held accountable for your actions. When you make purchases on or offline, you have to have the money to cover the expenses and you shouldn’t make purchases online without first asking permission.

Ok so after a few minutes of him crying, I stepped in the way a father should and I got my son out of debt. I donated $10 to his account to put him back in the positive. He now has $1 in his piggy bank. After seeing a full piggy bank, that $1 coin sitting there in his piggy bank all by itself will serve as a reminder of the consequences that come with being financially irresponsible.

At first, Ethan’s heart was broken b/c he saw his money come & go, but he learned a valuable lesson about money management that will last forever! Today, he lost a front tooth and is expecting a visit from the tooth fairy. Needless to say, his luck has quickly turned around, and there’s a smile right back on his face! 🙂

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