The opportunities abound to teach about personal finance and yesterday’s trip to pick up the family pictures provided yet another one. Youngest had joined me for a trip to the mall to pick up the photos, as well as to purchase a new pair of good shoes to replace the ones that he’d frankly outgrown to the point of pain; as we waited in the checkout line for the shoes, he glanced at me and playfully commented that he’d hoped that we could maaaaayyybe split a pretzel or even better, each have one. When I responded that we’d be passing on that since I had no cash, he noted cursorily that I did have a credit card instead. He was nonplussed at my curt response and the reminder that we had plenty upon which to snack at our own house, so he could simply suck it up.
We live in a society of immediate gratification and that affects almost everybody, me included. There’s a constant underlying drumbeat of consumption from mass media and while it’s easy to understand that you can’t constantly consume new cars and other large ticket items, it’s not so easy to understand that you shouldn’t constant consume the small ticket items like pretzels and Starbucks coffee. It’s the cumulative effect – the coffee-like drip, drip, drip if you will – of this small consumption that nickels and dimes us to death and leads our kids to think that they really can just have it all now.
After a moment of tense silence between the two of us, we began talking about how credit cards actually work and how the cardholder is actually paying the bank handsomely for the privilege of using the bank’s money. If many aren’t paying off their balance each month, does it make sense that they should put a $2 pretzel on their card, only to finally pay it off in two months at a final cost greater than the original $2? Expand that across more than just pretzels and that additional money can add up to something that can be used more productively elsewhere, for something of greater value. Youngest is a kid with considerable sense, frankly far more sense than some adults that I know – I’ve actually witnessed him facepalm when he’s watched adults do something stupid – and he nodded in understanding. He still wanted the pretzel, but he agreed that paying with a credit card wouldn’t be the best move around.
Figure out what your own rules are for these kinds of things, such as using a credit card or giving to charity. Then be sure that you take the opportunity to apply those rules when the kids are around and if you remember, comment on them accordingly. As for the aftermath with Youngest, I made sure that when we got home from the mall, that a snack was pulled out and consumed with Youngest to prove that we did, indeed, have something in the house to eat.