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A Money Lesson for My 7-Year Old … and What He Taught Me …

The last few months have been interesting, to say the least.  Thinking back to New Years, nobody could have anticipated the “new normal” we are now experiencing.  The irony is that this new normal seems to change with each passing day.  In some ways, at least for me, the increased time spent with my family has been such a blessing and has allowed us to refocus on what is really important. 

I was more fortunate than so many others, still able to serve my clients’ needs but from my home office.  My wife is a 7th grade math teacher at a public school up in Clarion County, so she was able to take the lead on all my son’s school work since he was forced into remote learning like all students across the country.  I was thankful everyday knowing my wife was balancing her duties as a teacher, remaining committed to all of her students, while also taking on the role of a 1st grade teacher for Isaac.

One particular day, Halee had to drive north to organize various things at her school so I was in charge of school for the day.  Since I work in finance, this was my chance take a deeper dive into money with Isaac.  The lesson: The value of money and where it comes from.  I asked him, “Where do you think money comes from?”  The logical answer…, “The bank, Dad.”  I laughed and asked, “How does the bank get the money that is in everyone’s accounts?”  His reply, “They (the bank) make it.”  Ah!  My time to reinforce, just like I have while coaching him, that good things come to those who work hard (most of the time).  The life isn’t fair discussion was a different lesson well before we reviewed the concept of money.  We also talked about how money grows, taxes, etc.

When we got to the part of the lesson about what money is used for, we talked about how you can spend it, save it, or give it away.  I told him that people who spend money tend to not have any and those who save it tend to have a lot.  I also told him that of all the people I work with, those who choose to give it away, in a lot of ways are the happiest people I work with.  He asked, “Are the people that give their money away rich?”  Again, everything is very simple and rational to a seven-year-old.  I explained that you don’t have to be rich to help others, people with a lot and a little can both help those in need.

Finally, we get to the part he was really looking forward to…the chore chart we put together and how much money he could make.  The rules:

1. Certain chores he would not be paid for – being a member of this household meant doing your part.  Cleaning your room, picking up after yourself, feeding the dogs, etc. were a requirement, not a chore he would be paid for.

2. I will not ask him to do any of the chores on this list.  He has to take it upon himself to be ambitious and earn his pay.

3. I will under no circumstance pay him for a job that is incomplete or incorrect (Yes, he asked if he could get partial pay for partial completion).  Another lesson in, “That’s not how the world works…”

4. And finally, he was required to save at least 10% and give away 10% of whatever he made.

Of course, he wasted no time wanting to do the first chore on the list, clean up dog poop in the yard.  $5 for completion and he could only do it once/week.  I helped him the first time so he knew what was expected and what it meant to finish the job correctly.

After we were done, we went inside and sat at the kitchen table.  There lay 3 envelopes, one for spend, one for save, and one for give away.  Next to the envelopes were four $1 bills and 4 quarters.  His face lit up with an ear to ear smile when I paid him and I reminded him that at least $0.50 has to go into each of the save and give away envelopes and he could put the $4 singles in his spend envelope if he wanted.  I also told him that I would match whatever he put into his save envelope.  He stared at the envelope for what seemed forever…I figured for a seven-year-old it as pretty cut and dry.  I would be out $0.50 to his save envelope and $4 would make its way into the spend.  After all, he was already talking about what he wanted to spend his money on.

My son is caring and empathetic, but what happened next still surprised me.  As he started to shuffle money around the table, he moved $2 to his save envelope, $2 to the giveaway envelope and only $1 to his spend envelope.  I said, “Buddy, it’s ok to spend some of the money that you work hard for on yourself.  You said you wanted to save up for that video game.”  He looked at me, and as he did his smile that just a minute or so before was as wide as his face, turned to a look of sadness and his eyes watered up.  He said, “Daddy, I like to save money so that’s why I put the $2 in save.  But, I was thinking about Jacob from school (for the sake of the story, we will call him Jacob) and he doesn’t have many things and he is ‘sensitive’.” Helping out with Isaac’s class parties, my belief is that Jacob has autism and it’s explained to the students that he is sensitive.  After his explanation to me, Isaac looked down at the table and moved another $1 from his save pile over to the give pile for Jacob.  He told me he could buy Jacob something nicer if he has more money and he has, “…lots of time to save for his game.”

There are times as a parent when you find yourself overflowing with pride and this was one of those times.  As tears formed on the top of my cheeks, I told him that was a really nice thing he was doing and that I would match whatever he saved and also for the envelope holding what he wanted to use for Jacob.  To date, my contributions in the form of an “employer match” is now up to $26 in the giveaway envelope, my match in his save is up to $14, and the smallest is his spend envelope.

So, my lesson on the importance of managing money properly to this 1st grader turned into a reminder to me about what is really important in life.  It’s not acquiring things or processions, it’s building meaningful emotional connections, positive human interaction, caring for yourself but also caring for others.  You don’t have to be wealthy to do these things as proven by a child.  Perhaps, if we as adults tried to think more like children, the world would be a kinder place.

Later that night, I remembered a quote I heard years earlier, which is probably the best way to end this blog: “I’ve learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel.” – Maya Angelou 

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Hefren-Tillotson Inc. is a leading diversified financial services firm providing investment and retirement plan management and comprehensive, financial planning through MASTERPLAN® for individuals and businesses. The firm’s wealth management services are administered by Certified Financial Planner (CFP) professionals, Chartered Financial Analyst (CFA) Charter holders, attorneys, Chartered Life Underwriters, and CPA/PFS’s. Hefren-Tillotson offers corporate services including 401(k) retirement planning, executive financial counseling, fiduciary reviews and workplace financial planning seminars. Founded in 1948, the firm is headquartered in Pittsburgh and has offices located in Pittsburgh, Butler, Greensburg, North Hills, and South Hills. MEMBER SIPC.