Teaching Real Money Lessons
For kids, money can sometimes feel like an abstract concept. That can be especially true when dealing with electronic spending and saving. No cash, no problem – just put it on a card, right? Not exactly. But teaching kids responsible money lessons before they leave home can help set them up for success.
Tim Sheehan, a father and the CEO and co-founder of Atlanta-based Greenlight said families can use allowances, chores and more to help kids learn the value of a dollar. His app is designed to be a central hub for teaching financial lessons, including earning, saving, spending, giving and (soon) investing.
“Greenlight is a debit card for kids that parents manage from their phones,” Sheehan said. “You can think of it as four or five accounts built into one app and debit card. It’s meant for the whole family, so the parents and all the kids can use it collaboratively.”
Families can include as many as five children on the app for one monthly fee of $4.99. The debit Mastercard can be customized with a photo for an additional charge.
Sheehan said children can learn cause and effect as it relates to money. Part of what he wanted to accomplish was having a way for kids to see the impact of spending on their bottom line – buy an ice cream and see the balance go down.
“It teaches them that money doesn’t grow on trees,” he said. “You have to earn money and there’s a finite amount of it. There’s some good teaching that happens there. They learn by doing.”
Sheehan said three financial lessons children can grasp could help them avoid trouble down the road: money must be earned, trade-off decisions have to be made and they should live within their means.
“It’s these key important financial concepts and financial behaviors that they are learning as kids that they take with them to adulthood,” he said. “It serves them well.”
And it is easier learn those lessons while parents still have oversight.
“We’re trying to provide them a safe environment as kids, so they can try and fail and learn from their mistakes, where the consequences are very small, versus when they’re adults,” Sheehan said. “They might make a mistake there and end up with massive credit card debt.”
Greenlight costs $4.99 per month and includes debit cards for up to five children along with the tools parents need to teach them financial responsibility. The first month is free. The service includes options for chores management, automated allowances, alerts when the card is used, parental control over where the card can be used and more. For details, visit https://www.greenlightcard.com.
Get more money lessons online:
· Consumer Financial Protection Bureau: https://www.consumerfinance.gov/consumer-tools/money-as-you-grow
· Northwestern Mutual: http://www.themint.org/kids