Teaching Our Youth the Value of a Dollar
Ask Why, Before You Buy
Taking your children to the grocery store, let alone the toy store or department store is never a parent’s favorite task. So many new, attractive things to see and touch…and buy! If you ask any parent, a trip to almost any type of store is often disrupted by the statement, “I want that.” But as we adults know, it’s not always about getting what we want, but more so about what we need. In the financial world, we call this a tradeoff. A tradeoff is forgoing one desirable thing (perhaps several times) to afford something else; doing less of something to gain more of something else. This often means giving up a “want” to successfully fulfill a “need.” So how do we teach children to understand the difference early on; to prepare them for their certain tradeoff futures?
The answer is to Ask Why, Before You Buy. Explain that there are wants and needs. “I want” typically encompass items or services that you’d like to have, such as a toy or game, but can live without if necessary. “I need” are items or services that are necessary in order to comfortably survive. To help your children understand the difference; try asking them these 7 questions:
1. Is this a need or a want and why?
2. Do I have enough money for this without borrowing any?
3. Is this the most important thing that I want right now? Why?
4. Can I wait three days to buy this so I can think about it more?
5. If I buy this, will it take money away from something I have been saving for?
6. Can I buy something similar for less money
7. Will I be sorry that I bought this later? Why?
Let’s challenge our youth to think about these questions now, so that later in life, when faced with financial decisions, they will be able to choose living within their means instead of spending just to spend. Average consumer credit card debt has increased significantly over the past several years. Let’s arm the future of America with the necessary tools for the best possible chance to break that trend.