Your kids and Economy

[Ester Maria]

I'm not talking about allowances, more like... how, and at what age, do you teach your children to deal with money in a more elaborated context (past personal finances) - if you teach it at all?

 

My mother, and especially my in-laws, have been complaining over the years on how the girls are "financially illiterate" and how they have to explain to them all of the things we, parents, should have taught them from early age (I disagree that a child of one-digit age should operate with the terms "stocks", "currency", "mortgage loan" etc, sorry, and I don't understand why would anyone want to explain those to a kid... but now when they're slowly hitting their teens, maybe it would be the time to handle some basics). So I wanted to ask over here if there's somebody who teaches - formally or informally - concepts in Economy to their children, at what age do you do it and how?

 

So far they know how to convert dollars to euros to shekels (due to the fact we travel quite often), they vaguely understand how some currencies can be strong/weak and how they can change, but don't understand mechanisms behind it, and I'd like to teach that in the simplest manner possible, sort of "how the world economy works" thing. And next, elements of banking (how economy works on a micro-level, how banks function, where money comes from and how it's regulated, etc.).

 

Did anyone here do something similar with their kids?

What materials, if any, did you use?

How old were your kids and how well did they understand it?

Do you think it's important to know these things or not really?

Am I hitting for something overly ambitious and should I wait till they're older teens, or my in-laws are right and they should know the basics?

 

Thanks for your suggestions in advance.

[RoughCollie]

When my kids were younger, I taught them to allocate their allowances in this manner: charity 10%, long-term savings 30% (car, college), mid-term savings 30% (Nintendo DS), spending money 30%.

 

I also taught them basic shopping for value techniques. That's it, unless the subject comes up in conversation.

 

I am reading Thomas Sowell's books on economics, with an eye to teaching the information to all my kids this summer (they will be ages 14.5 and 16). I don't think DD will be interested at all, but I'm going to include her anyway.

 

I think the information will be useful to them at that point. It's useful now because the boys are arguing politics and economics with one another -- but I have to learn some it of myself first.

 

I will be showing them how to do cash-basis personal budgets, plan and save for large purchases, and so forth, as well.

 

I don't know anything about stocks and investing, and I'm trying to learn about that. The first book I read was Too Big To Fail and I had no idea what the author was talking about half the time.

 

I am looking into the Stock Market Game, too. http://www.stockmarketgame.org/

Edited February 2, 2010 by RoughCollie

[Irene Lynn]

We probably covered most of these topics at ages 10-11. Our dd was quite interested in economics, too. If she hadn't been as interested, we wouldn't have thought of teaching it so early. She understood just fine. We read the book, "Whatever Happened to Penny Candy", showed her mortgage tables, and started teaching her how to use Quicken. We just talked about all sorts of things. She also spent some time learning about the stock market. I cannot remember what was used, because she went over to a neighbor's house to do it. She also did some things with some online stock market game.

 

At 16 she is getting a very solid full year class in economics.