Don't call her 'Mom,' call her 'Visa'
Posted
Jul 01 2008, 08:00 AM
by
Karen Datko
Rating:
Blogger Rosalind Mays gave her kids credit cards. What? Is she nuts? They're only in sixth grade or thereabouts.
Explaining one of the more interesting methods we've encountered for teaching kids about money, she writes in a post at Real Life Debt: "But the catch was (cause there is always a catch), I became Visa. I've always wanted to be a banking giant."
She breaks down her system into three steps. We'll give you a quick synopsis, but encourage you to read her full post. It's a must-read for parents, considering there's no shortage of financial illiteracy in our part of the globe.
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"They work hard for the money" is Step One, she says. She posts household jobs and their respective wages on the fridge. The kids apply. Their work is evaluated to see if they should get full compensation. Their wages are stashed in an envelope.
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"Don't leave home without it." When the kids want to buy something or go to the movies, they've got to borrow the money from Mom/Visa. She explains to them all the rules in the fine print, like minimum payments and interest rates. ("And I watch their eyes glaze over -- much like today's adult credit cardholder," she says.) Then Mom/Visa keeps track of what they spend.
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"The joy of payday and the agony of bills." At the end of the week, they get their wages and their credit card bills, including finance charges and fees whenever they've exceeded their card limits. In a few weeks, it becomes abundantly clear that the bill can continue to grow even when they've curtailed spending and made payments.
"It's amazing how math skills get so much sharper when it deals with labor and money," she writes. "And quickly, your kids begin to realize how much labor it takes to get out of debt."
