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EDITOR'S NOTE: The following is George Bailey's weekly report "Meanwhile, Back at the Ranch" about he and his wife's efforts to teach their kids financial freedom.
Last week, I ran into my friend and former colleague Betsy Cohen. She's been nothing short of amazing in her support of my efforts to get the Choose the Nickel podcast off the ground. And if you haven't heard Betsy share her own childhood stories of learning about money and work, you should definitely give her a listen.
One of my favorite stories from the interview was about how Betsy taught guitar lessons as a teenager to save up a little extra stash on the side. None of our common friends knew Betsy played the guitar. We'll have to recruit her for our next folk rock singalong. Betsy, time to bring your best Carole King. I'm also thinking of planting requests for "American Pie" and "Country Road." Do you feel up to "Stairway to Heaven"?
Anyhow, Betsy and I chatted it up a bit, and she showed me a few photographs of jars that her daughter-in-law had made for her children. I couldn't resist but share.
Photo by Lauren Kraselsky Cohen
Photo by Lauren Kraselsky Cohen
Very stylish. You can find more of her cool creations on Instagram under "prettybusymommies."
I've heard a lot of positive talk about savings jars, particularly from friends and in news articles about financial capability. Savings jars are appealing as a teaching tool because of the visual impact they have on children. Kids get to experience the thrill of saving up as they watch the money accumulate.
The usefulness of such a visual aid is hard to dispute. What child doesn't prefer a more concrete example over the abstract? My kids' eyes glaze over enough whenever I try to explain my work in life insurance. Why not give them a break when it comes to more basic financial principles?
However, it's not that easy. In order for your children to enjoy the sight of money as it pushes its way to the top of the jar, there has to be, you know, money. I can't remember the last time I've seen cash, let alone had any in my own possession. Where are people getting this stuff? Didn't we burn it all years ago?
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I'm going to level with you. I use my credit card for everything. There are some dangers that come with that decision. First of all, people who buy with plastic are likely to spend more than those who go with cash. Plastic users are numb to the idea that they are actually losing something when they make a purchase. Another danger of using credit is that the barbarians who own parking lots in downtown Saint Louis often allow only cash. I'm tempted to just leave my car there the next time they refuse my Discover card. Still, my wife and I pay off our cards monthly so as to avoid credit card debt (something we've experienced once and intend to avoid at all costs going forward).
If I'm going to seriously consider using the jar system for my own children, I'll have to go to the bank. I honestly can't remember the last time I entered a bank other than for business meetings, and I have to think hard to recollect which bank Christina and I even have an account with. Once I get in there, I'm not even sure what I'm supposed to do. How much money do I ask for? How do I get the money out? Should I just walk over to the vault and take what I need? Do I leave a note in the vault to let the bankers know what I've done?
I'm going to have to stew over this one in a corner somewhere.