Monday, June 25, 2012

Why we are in debt

I am making a real effort to teach Elli about money even though she is only five.  I think having a sense of budgeting, holding off on purchases, and saving up for things are extremely valuable throughout life and I am attempting (with mixed success, admittedly) to impart these lessons by giving her a small allowance.  I figured that there would be some trouble with Elli not accepting the limitations of her piggy bank balance but I never anticipated other adults being so uncomfortable with it.

This weekend Elli and I were in the grocery store and she wanted to buy a R2D2 Pez dispenser.  She has plenty of candy in her treat bag and nobody in the world 'needs' such a chunk of rubbish so I certainly had no intention of buying it for her.  I gave her the usual speech about how she had a few dollars in her piggy bank and the toy cost three dollars so she could afford it if she really wanted it.  I asked her to think about it and decide if this was something she really wanted or if she wanted to save up to buy something else.  She eagerly decided to buy the toy for herself but before it was our turn to pay an older lady in the line asked if she could pay for it instead.  Strangely she simply gave Elli a five dollar bill and told her to keep the change...  I don't know what to make of that.

I could, of course, just be pleased that Elli was getting the toy she wanted and that I didn't have to foot the bill but I was actually irritated because the entire point of that exercise was to teach her about money and thinking about value.  The plastic hunk of junk will be forgotten in a day or two but the lesson could contribute towards a lifetime of not getting in debt foolishly like so many Canadians seem desperate to do these days.  I didn't want to refuse the offer because graciously accepting gifts is another useful habit to have and I don't want to come off as just being mean to her either.

The strange thing is that this isn't an isolated incident.  When I wind up my 'well, you can buy this, it will cost X and you have Y in your piggy bank, are you sure?' speech adults seem to consistently leap in with money in hand to try to prevent Elli having to actually make a decision and live with the consequences.  I don't know if they are thinking that I am so poor I can't buy a two dollar thingamajigger for Elli or if I am just being a jerk; all I know is that they listen to the money speech and simply can't tolerate it.

Five year olds are *built* for making mistakes.  Their passions are momentary, their memories short, and their ability to actually cause themselves long term harm with foolish decisions is nonexistent.  They need to make those mistakes, lots of them, and gradually come to an understanding of the consequences of decisions so they can make good ones when it counts.  They need to buy junk, have it break, and realize that buying quality is useful.  They need to run out of money and notice that not saving money for later is a disaster.  They need to learn these lessons before they take out a credit card and join the rest of society in having an ever increasing debt to income ratio.  What they *don't* need is another piece of sparkly junk bought for them by an adult who can't abide the concept of delaying gratification.


  1. Just out of interest, are the people who do this typically elderly? I think the ability to spoil children is something a lot of people relish in their older age - it's why grandkids are so fun.

    I have to think that for the most part people doing this must think that you have limited financial means. It would be taboo to jump in on a stranger's parenting.

    At any rate, I'm really glad you wrote this because I can imagine finding myself in a very similar situation one day and this gives me time to think about how I will react.

  2. The specific incident I wrote about here was with an elderly lady but in general the incidents have come from adults ranging from 30-70 and both genders. I have a pitiful sample size though so I certainly won't make any claims as to who does this more.

  3. I'll be wiring money to Elli immediately. She needs her own cash. Lots of it. :)