Our 6 years old daughter starts to get an interest in money and banking. This seed that she has, needs to be cherished and taken care of so that it can grow. I look forward to be her guide during her journey. Hopefully, a short journey to FIRE.
As we know, not every step is an easy, joyful step. And so, we had a first tough step to take with her.
Here is some background. Since September, she gets an allowance of 1€, every Sunday. In the mean time, she knows this very well and does not hesitate to remind us in the case we forget. The money goes straight into her savings pig. We tell her the money is hers and she can do what she want it.
Next to that, when she gets money from the grand parents for new year, birthdays,… We tell her that we put it on the bank. She is fine with that.
Recently, she asked if she needed to chip in for the ski holiday when she heard my wife and me talking about the costs, later, she did the same when we talked about the summer holiday. We agreed she would buy us a drink next time we go to town and have time for a visit to a child friendly bar.
This Saturday, we went to town. Before leaving, she wanted to exchange her coins into paper money, somehow she likes that better. She wanted to exchange 20. As she only had 16, I offered her to exchange already 5. Then, hells brakes loose…
It turns out that she expected to have a bankcard, just like we do, so she can go and withdraw whatever she wants, just like we do. She knows she has more than 20, so, why can she not access it? She does also not sees the value to keep money in the bank. It can be spend as well.
Lets’ stop here: some education is needed
After listening to her, we started to explain how our money gets on our account (working…), what happens when the account reaches zero (tough luck, no more spending that month) , and more importantly, why she needs to save money as well: not all money is for spending.
She gave it some thinking, and in the end, we agreed she could use the money for herself. And in addition, she now will keep the savings account. We went out and she bought a nice set of earrings.
To us, adults, this is only a small step, for her, it is a giant leap! I am curious to see what other money/saving/spending related topic she will throw at us.