Financial literacy (being smart about money) is something close to my heart. Before I started working with private foundations with millions in assets, I didn’t even know what a hedge fund was (okay, honestly, I’m still a little foggy.) And I look at my CEO, for whom this is his sixth company, and wonder how he learned to be an entreprenuer, to get financing, to start a company. It feels like the wealthy in this country have a knowledge base that the average person doesn’t.
The beautiful thing about Financial Literacy is that it often seems to include learning to donate a part of our income to help others. Maybe you’ve come across the idea of having kids split their income (such as it is) into three pots: Save, Spend and Give. The idea is that you can teach them some financial skills, and make charity a habit at an early age. Many religious traditions encourage parents to teach their children to “tithe” at a young age, but this concept is not related to any particular religion.
I’ve come across two different organizations that provide a structure to help parents set up and follow-through with the Save, Spend, Give idea: Moonjar and Money-Savvy Kids. Both have won a ton of awards. Interestingly, they’re both decidedly secular and focused on good money habits, not on encouraging tithing.
Moonjar
According to their web site, “Moonjar moneyboxes were created as a tool for children and families to incorporate strong financial values and practices into their daily lives.” It’s basically three colored boxes, one for each category, that are kept together with a yellow band. A Moonjar, just $8 or so, includes a passbook to record “deposits” and a guide for parents to understand how to use the Moonjar.
One mother shares the impact of Moonjar on her son:
“Moonjar has helped him to be conscious. He knows that he cannot spend money on just anything because there are people in the world who are really in need. Two or three dollars… many people in other parts of the world are very poor and desperately need those dollars, and so he simply should not spend his money unwisely. He has learned to use his money for good things and he is learning to allocate his money.”
– Felicitas Estrada
Student and Mother of Daniel (10) Sunnyside, WA “
I actually got my kids and my nieces each a MoonJar for Christmas last year, but I think they’re a bit young. I haven’t even put Charlie’s together.
Money-Savvy Generation
My first introduction to Money-Savvy Generation was something called The Stanford Marshmallow Study. Here’s the punchline: four-year olds who can resist eating one marshmallow now for the promise of getting two later turn into more successful adults. The ability to delay gratification turns out to be a critical life skill. (Since reading this study, I keep asking my four-year-old daughter if she wants one lollipop/cookie/skittle now, or…and the answer is always “yes!” Sigh. I’ve got some work to do.)
Founder Susan Beacham describes the origins of the organization this way: “My dream is to teach money management basics to elementary school aged children, a segment of our educational system virtually untouched because of the perceived complexity of the subject matter. Stated differently, I wanted to get ‘out in front’ of money management behavior before bad habits set in.”
If you’ve visited a children’s museum or gift shop, you’ve probably run across the Money-Savvy Pig. It actually has four chambers, differentiating “Save” (for things you want to buy in the next 12 months) from “Invest” for things you want long-term, like a car, or college.
Money-Savvy Generation has done academic evaluations of the impact of their curriculum, and they are making progress in getting into schools to reach kids whose parents may struggle with finances themselves.
I especially love that some of the larger financial institutions in the Chicago area (they’re based in the Northwest suburbs) are sponsoring the introduction of the Money-Savvy curriculum into the public schools. Teaching kids strong financial habits and getting name recognition for when those kids grow up and start to save and invest–now that’s strategic philanthropy.
