A 9 Year Old’s Perspective on Money
August 08, 2012So far I’ve learned a lot about my two oldest children in the last couple of weeks. I’ve learned that Rachel is a spendthrift and sees money as a means to necessities. David, on the other hand, is a value hunter and wants to know that whatever he spends his money on is going to last.
Next in line would be Ethan. Ethan is 9-years old, and I imagine his perception of money is going to be as unique as he is:
Dad: Ethan, where does money come from?
Ethan: The government.
Dad: What do we do with money?
Ethan: We use it most of the time to buy stuff.
Dad: What kind of stuff?
Ethan: Sometimes food, sometimes games to play with, clothes.
At 9-years old, Ethan is able to recognize that money is a means of exchange. Let’s see how he responds to an ethical question.
Dad: If you found $100 on the ground, what would you do with it?
Ethan: Well, I would probably come home and tell my family members “I found $100 on the ground!” Then I’d ask mom if I could keep it.
Notice he doesn’t ask dad. We tend to be a fairly traditional family. Mom is tenderhearted and has the gift of mercy. Dad is the disciplinarian and would probably be more likely to say something like “Who does it belong to?” No wonder he asks mom.
Dad: If mom said yes, what would you do with it?
Ethan: I’d put it in my wallet.
Dad: How much money do you have in your wallet right now?
Ethan: I have around $23.
Ethan and Jake (the youngest) like to count their money regularly. For them, it’s a way of keeping score. Right now, Jake has $14 in his wallet, so I guess you can see who is winning.
Dad: Wow, $23. Is that a lot of money?
Ethan: Not really.
Dad: How much do you think is a lot of money?
Ethan: $2,000.
What an odd number to pick. I mean, he could have said anything: $100, $1,000,000, why $2,000? I think he was actually trying to decide what he thought a lot of money was. I remember getting $100 for Christmas as a child and thinking I’d just hit the lottery. He probably does think $100 is a lot of money too, but it kind of scares me that he said $2,000. Does he think I’m made of it?
Dad: Do you ever spend your own money?
Ethan: Sometimes.
Dad: On what?
Ethan: On candy and Pokémon cards.
Dad: What is the most you have ever spent on Pokémon cards?
Ethan: $20.
Dad: How much do you think those cards are worth today?
Ethan: I don’t know; it matters what card it is.
Dad: What’s the most valuable card you have right now?
Ethan: Latias EX
Dad: How much did you pay for it?
Ethan: Nothing. My friend gave it to me for free.
Dad: So how much is it worth?
Ethan: I don’t know, maybe around $7.
Dad: Why do you think it is worth so much?
Ethan: People who really like these cards would like this one because it is a strong card.
Dad: So why did your friend give it to you for free?
Ethan: He doesn’t like Pokémon cards anymore.
Dad: Will you ever not like Pokémon cards?
Ethan: Probably, when I am older.
Dad: So what will you do with them when you don’t like them anymore?
Ethan: Sell them.
I hope you don’t mind the lengthy exchange, but boy did it shed some light on the mind of a 9-year old. There are so many teachable ideas here. For example, notice how spending $20 doesn’t seem like a big deal when you think $2,000 is a lot. Unlike David, Ethan may not fully appreciate the amount of effort that goes into earning money.
Next, look at how much he has to learn about perceived value. In his eyes, the most valuable card is worth $7, but to his friend it is worthless. What is it they say; one man’s trash is another man’s treasure? I’m not saying this is a bad thing at all. The fact that he sees value where someone else does not is a good thing and could serve him well later in life as an investor.
And that brings me to my next observation. Notice what he says he would do when he is no longer interested in Pokémon cards. He’d sell them! The boy’s an entrepreneur, and that is something I should be willing to nurture.
Dad: Would you rather have $100 today or $200 a year from now?
Ethan: I’d rather have $200 a year from now, because it’s more money, and I might be saving up for something, and by waiting I would forget that I had it coming and it would be a surprise for me later.
I just adore the thoughts that are coming out of my kids’ mouths. The fact that he would “forget” about the money is one of the reasons we at Financial Finesse encourage automatic savings—set it and forget it.
Dad: What happens when someone spends more money than they make?
Ethan: They go into debt to the person they owe.
Dad: Is debt good or bad?
Ethan: If you have debt to somebody it’s bad, but if someone owes you that’s good.
Dad: Do you owe anyone right now?
Ethan: No.
Dad: Does anyone owe you?
Ethan: Yes, you owe me $3 for moving bricks.
[Actually, I owe him $5, but don’t tell him.]
Dad: Do you think you’ll ever borrow money?
Ethan: Yes.
Dad: For what?
Ethan: I don’t really know, maybe to buy dog food if I have a dog.
Dad: If you had a dog, and you were out of dog food, would you rather borrow to buy more dog food or get rid of the dog?
Ethan: Borrow for dog food.
Well, I guess Cody (the dog) has a special place in Ethan’s heart, because you know what I’d do. Aside from borrowing for dog food, I did find it interesting that Ethan just assumes borrowing is part of managing money, so it will be very important for me to teach him the proper use of credit.
I’ve enjoyed my talk with my son, and I hope you’ve taken away a few questions that you may want to ask your son or daughter to learn more about how they relate to money. Tune in next week as we find out how Jacob, the 6-year old, answers similar questions about managing money.