Tag: Children

Does money grow on trees?

When I started this blog a year ago, I used the ‘About me‘ page to tell the story of my childhood dreams of a money tree. How I planted my pocket money in the hopes that it would sprout into an everlasting supply of wealth.

Over the past year, since starting Enrichmentality, I’ve come back to this topic again and again.

Because the truth is, there is such a thing as a money tree.

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What are apps teaching kids about money?

While both parents and children report schools aren’t doing enough to teach financial literacy, 75% of American parents (and 74% of kids) believe financial apps are ‘a good way to teach [kids] about financial matters’.

Games tied with food as the number one purchase made by kids, followed by toys (tied with clothes). A survey conducted by Australian parenting website raisingchildren.net.au also found that entertainment, toys and games represent the biggest pocket money spend.

But what kinds of lessons might kids be learning from apps?
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What are toys teaching kids about money?

Last year, I took some photos of my mother’s toy cash register for a blog post. Around the same time, a couple of our friends came to stay with their young daughter. She had a toy cash register of her own (which I also photographed). The two toys looked pretty similar (the newer version had an electronic display, and came with a paper ‘credit card’).

The role of artefacts like games in language development has long been an interest of mine. When I saw these two cash registers, I became interested in the role of toys and games in financial literacy.

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Where should kids learn about money?

Like language, money is a symbolic system we use to communicate with each other. Kids’ exposure and sensitivity to language begins early, and the same may be true of money. The majority of opinions agree financial education ‘begins with children – the younger the better’. In the last post, we looked at what an important role financial education and family background has in influencing outcomes in life.

But where do – and where should – kids learn about money?

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Are the wealthy rich because they’re smart?

Are rich people rich because they’re smart?

Or to put it another way, are you not rich because you’re not smart enough?

According to a study conducted by the Joseph Rowntree Foundation, 69% of people believe ‘there is enough opportunity for virtually everyone to get on in their life if they really want to’. In other words, if you’re poor, it’s your fault.

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How can I get my family on board with saving?

When it comes to spending, it’s easy to get excited. You don’t have to try hard – advertisers do all the work for you, making the acquisition of shiny new things look and sound fun and appealing.

Spending, however, requires a little more creativity on our part. But even if you manage to get hyped about saving yourself, your family might think you’re a grump if you’re constantly reminding them to switch off the lights and close the doors and buy the cheaper detergent.

So how can you get your family on board with saving? How can you use the same sorts of tricks advertisers do to make spending seem so appealing to convince your family – and perhaps yourself! – that saving is the best course of action?

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How can I escape the herd mentality?

The herd instinct is ‘a mentality characterized by a lack of individual decision-making or thoughtfulness, causing people to think and act in the same way as the majority of those around them’. It’s a familiar term in investing, where investors are influenced by the positivity – or negativity – of others, and their behaviour then feeds into the market, perpetuating this cycle and sometimes leading to bubbles or crashes.

But the herd mentality I want to talk about today is the one that is much bigger than the stock market, and permeates almost all of our money (and other) decisions.

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How do our financial tongues differ?

While children generally learn the variety of language their parents speak, seemingly ‘automatically’, this does not mean they have access to all of the dialects of that language equally. Furthermore, different dialects have different uses and are valued differently in different contexts.

I grew up speaking a more rural variety of English, and acquired a more ‘standard’ variety later in life.
Most children grow up speaking the familiar, informal language of the household. They learn the more formal registers considered suitable for education and the workplace.

Like stigmatised language varieties, some varieties of financial literacy – beliefs and behaviours connected with money acquired from childhood – are less valued in society. That is, they are associated with less symbolic and social value. They may lack prestige, and possibly lead to social exclusion.

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How do we learn to speak money?

Learning about finances, says Lanchester, author of How to Speak Money, is a bit like learning Chinese – ‘figuring out the meaning, word-by-word’. This, he says, is how he learned to ‘speak money’.

Many of the theories used to explain language acquisition, Furnham reports, have been used in conjunction with learning about money. (Including behaviourism and cognitivism).

Just as our mother tongue is learned primarily in the home, supplemented by formal lessons at school, many of our ideas about money are formed in our early years in the family.

Summarising studies of ‘money troubled’ adults, Furnham states that many of their troubles originate in ‘lessons’ learned as a child, with the family as the primary socialisation unit. ‘Teaching economic literacy, good money management and sensible saving and spending should be a parental priority, Furnham points out. He refers to Charles Collier’s notion of ‘financial parenting’ in the book Wealth in Families.

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