Cash. When you are starting to teach your kids about money, we believe cash is hands down the best and most effective way to do so. Studies have shown that people spend less money when they are handing over paper bills than when they swipe a card.
You might be surprised, then, to hear that there comes a point where we recommend you move your kids from cash to plastic. It’s not where we start with the youngest kids, but in today’s digital age, it is absolutely necessary for kids to understand how plastic works and that there is real money behind every swipe at the register. The key is being able to maintain the good practices that have become a habit while moving from cash to a card. But using debit cards can be a slippery slope.
Teaching kids to manage plastic without incurring debt or overdraft fees seems like a narrow line to walk, but we have found a key tool that makes the entire process pain (and risk) free.
This week, in our new podcast format, we talk with Bill Dwight. Bill is the creator behind FamZoo, a prepaid debit card designed to help your kids learn to manage money, pay off debts, and maintain their budgets. We love FamZoo at our house and plan to use it for years to come.
During the interview, Bill brought up a really neat way to teach kids to understand and appreciate their savings account. As a matter of fact, it was so cool, we are offering it as a downloadable right below the podcast.
And finally, we’ll share a little story that surprised even Bret and I when we went on vacation for Christmas. As parents we all wonder sometimes whether or not the lessons we teach are sinking in. Well, we got a little glimpse of it first hand just last week.
We hope you enjoy the show! Have a comment? A question about something we’ve discussed? Make sure to let us know in the comment boxes at the bottom of the page.
Links from the podcast (book links are for affiliate products):
Chicago Tribune Article:
How to Teach Your Kids About Money: Tell Them Early, Let Them Spend