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How do we raise financially fit children? Especially in today's world where the see-now-buy-now mode of spending has become the norm. If you’re looking for the answers, Joline Godfrey has written an entire book on the topic.

Over the last three decades, the American creator ofand author of  Joline Godfrey been an innovator in financial education and wellbeing for families. Her mission? To increase financial intelligence among young people.

“I was always mystified that families expect kids to be financially fluent, magically, at 12 or 16 or 20 — without instruction and practice first,” she explains. She points out that even in households where money isn’t directly spoken about, we’re sending messages about money from a very young age. “Money is always talked about, it’s just not always a verbal conversation and we’re not mindful about the messages we send in our behavior… are we modelling consumption? Frugality? Generosity? Are we teaching mindfulness?”

Here, we speak to Joline about how purpose powers our lives and how to teach children financial awareness.  

You are a trained social worker – how has this influenced your work in financial education?

I’m trained to think developmentally. I was always mystified that families expect kids to be financially fluent, magically, at 12 or 16 or 20 — without instruction and practice first. I suppose back in the day — before everyone had credit cards; and when interest on savings accounts actually accrued, it was all easier. But as the financial world grew more complex it became unreasonable to think anyone could grow up to be financially fluent without help…

Tell us about the messages we’re sending children if they grow up in a home where money is never talked about?

Money is always talked about, it’s just not always a verbal conversation and we’re not mindful about the messages we send in our behavior… are we modelling consumption? Frugality? Generosity? Are we teaching mindfulness? Money is shameful for kids when it makes them feel bad — and when they feel a tangible gap between their lives and that of their friends; when the privilege gap is apparent, they feel ashamed — or at least awkward and they need a way to address this.

On the flipside, in some households, money is too much of focus – what impact can this have on children?

In households where it is all about the money, we find there is too much emphasis on privilege and too little on the privilege/responsibility equation. Privilege comes with responsibility — and kids who are not raised with that consciousness tend to have less self-awareness. 

In your book Raising Financially Fit Kids, you talk about how “allowance is a tool for teaching children how to manage money.” Can you share why allowance is so important?

Malcolm Gladwell reminded us we need 10,000 hours (at least) to master anything. It’s true of financial fluency as well. Kids need practice: to make choices, control impulses, learn financial language, manage cash flow, live within our means, earn and invest, etc. etc! A well-managed allowance gives kids (and adults) excellent practice!

"Purpose powers our lives."

Joline Godfrey, Author of Financially Fit Kids

In your book Raising Financially Fit Kids, you share a clearly laid-out framework of Ten Basic Money Skills such as saving, spending, budgeting…

They are all in the book and are rudimentary skills, a beginning. Families can select their own ten skills, as the point is that financial fluency is a life-long practice. You may learn to save, spend share, as a kid, but if you live a life of financial mindfulness you will develop economic self-defence; impactful philanthropic skills; sustaining wealth building skills… it is a lifelong practice, not an event. 

In your book, you give readers some Money Messages to share with kids -what are some of these key messages?

Messages need to reflect the family values: sustainability, mindfulness, priorities, family purpose… what is it that matters in the family? Sadly not many families have these foundational conversations with each other — and parents need clarity on their values and purpose so they are clear on the messages they want to consistently deliver to their kids…“Just because we can, doesn’t mean we should,” is one of my favorite! 

In the book, you share a short chapter on raising young philanthropists – talk to me about how this can benefit children long-term and help them to feel like they are part of something bigger?

Purpose powers our lives… the blog I wrote about McKenzie Scott is the best response I can offer. You can read it . Helping kids build their identity by understanding what drives them is one of the upsides of giving kids a chance to explore philanthropic experiences. 

At what age can children start investing? How can you best communicate what investing is to our children?

Immediately: you ask them to invest in learning, invest in the family, invest in community…if they see investing as about something more than just money they will invest money differently. Kids start collections because they are obsessed with shells or postcards or model cars… they learn some of the basics of investing by managing their collections—and learning the language of investing: sustaining, growing, analyzing, saving for something meaningful for others. Investing is not just about money, it’s about nurturing something to grow. 

What about budgeting – we live in a world where children (and largely adults) want everything right now and there’s always a new shiny toy looking at them. How do we teach our children about budgeting?

This is where the phrase “Just because you can, doesn’t mean you should” is so important. You have to say no to kids; help them do hard things — nurture grit. Managing money is about seeing ahead, planning for the future, living within boundaries, taking risks to break boundaries — but doing so mindfully. We’re back to clarity about values and messaging.  

You write about how financial education is not just about the money – can you explain what it’s about?

I have painted that picture above. It’s your values, a reflection of who you are or want to be, not just the logo you can afford to wear or the car you can own. Financial education is all about understanding yourself and the skills you need to help you blossom and grow 

What does financial sustainability mean?

It’s living within your means; and building reserves to get you through rough patches as well as having surplus to build a future.

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Disclaimer

AllBright cannot guarantee that all of the information provided in this video or article is accurate. Use the information provided on our website at your own risk. If you wish to make an investment you should seek independent financial advice before doing so, and ensure that you have carried out your own research on the product or company that you are investing in. Any advice provided is not tailored to anyone’s individual situation, as each individual is in a different situation. AllBright does not accept any liability whatsoever for any action taken or losses incurred as a result of the information provided on our site.