How Lunar New Year red envelopes can teach kids to manage their money
On the Coast's finance columnist says Lunar New Year is a great opportunity to teach kids about money
Giving "lucky money" to children of friends and family is a common Lunar New Year tradition. But On the Coast finance columnist Mark Ting says it can also be a great opportunity to teach kids about managing their money.
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Mark Ting's advice on how to use that money as a teachable moment:
1) Typically how much "lucky money" does a child receive around Lunar New Year?
In my experience, there is a direct correlation between the number of Lunar New Year dinners we attend and the amount of money my kids receive. My kids have received a total of $130 each — but that may not be typical.
2) How would you use a money giving tradition like "lucky money" as a financial lesson?
I am open about discussing money and personal finances with my kids. I want them to appreciate how hard it is to make and save money.
One way I do this is by letting them make their own mistakes — I've made hundreds of financial mistakes in my past and I'm better off for it.
3) As parents, how do we get our kids to appreciate money and not just think of us as an ATM?
I hold my kids accountable for their actions. Both my kids were in swimming lessons — Tyler passed his level but Maya didn't.
Had Maya tried hard, listened to her coach and still not pass, I would be fine with that. But Maya didn't pass because she was messing around and didn't follow instructions.
For that reason, Maya will be using some her lucky money this year to retake those swimming lessons.
4) Many children do not have any money or a bank account. Is there a way to teach them about finance?
It doesn't have to be about money. What do we often receive from our kids, if they can't afford to buy us presents? We get "service" coupons — a coupon for breakfast in bed or to wash the car, clean the house etc.
To me those coupons are a form of currency that can be used to teach your children about finance while having a little fun at their expense.
5) Does it work? Do you think your children have a fairly high financial acumen for kids their age?
Not really — I'm a realist. I know that the majority of these lessons are not landing but I still think having an open dialogue about money and finances is very important so I'm going to keep up with the lessons.
This interview has been condensed for the web. To listen to the full interview, click on the audio labelled: Using 'lucky money' to teach kids about finance