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Raise a Smart Spender

Teach your child the principles of smart spending with help from Neale S. Godfrey, author of Money Doesn’t Grow On Trees: A Parent’s Guide to Raising Financially Responsible Children.

How do you begin to make a concerted effort to purchase only what you need and really want, and ignore the enormous pressures to buy what you don’t need and don’t really want? How do you stick to that budget? I’ll detail some of the rules to follow, and the games and exercises that will make staying on a budget a lot more fun for you and your child.

First, start by explaining to your little one what “good” spending and “bad” spending are. Good spending might be when you use money to buy something you really need, like notebook paper for school. Bad spending is when you use all the money you have in your wallet to buy candy. Think of your own examples of good and bad spending that will be meaningful to your child.

Next, explain that your goal, and the child’s, is to learn how to be a good spender, or consumer. Here’s a younger child’s definition:

GOOD CONSUMER: A person who spends money wisely.

Sounds pretty simple, eh? So is the formula for becoming a good consumer. It requires equal parts of doing some research and planning, or “homework” as I like to call it, before you even walk into a store, and then a healthy dose of self-discipline once you’re there.


Let me expand a bit on this formula because I think it cuts to the heart of being a wise consumer and a savvy financial manager.

Planning what you want to buy (before you’re in the store and tempted to do otherwise) is the key to successful financial management. When you formulate such a plan, it’s called a budget.

Before you lay out an entire annual budget for you or your child, keep in mind that planning what you want to buy is as important for the little ways you want to use your money (like a quick trip to the grocery) as the big, long-range things (like buying a bicycle or a car).

Most people do the greatest amount of damage to their budgets through spur-of-the-moment impulse buying. Plan what you want to get before you leave the house.

Research means gathering all the pertinent information about what you plan to buy before you walk into a store, or click the button to make an Internet purchase. If I were the one deciding to go out and buy an iPod today, I wouldn’t know whether $100 was a bargain price, or $500, or $1,000. And if I just wandered into a store without knowing what features I wanted or how much storage was a lot, I’d be putting myself at the mercy of a salesperson who might or might not be knowledgeable and who might or might not have my best interests at heart. I’ve been a salesperson myself and I know that most of them are smart and honest, but it’s still better to trust…and verify.

Chances are that, as a parent, you already have your “degree” in consumer research: you listen to and read the advertisements for products (and sales); you check with a neighbor to see where he got a good deal on a weed eater before you buy one; you take the tip when a friend mentions where she stocked up on sale-priced toilet paper; you clip only the coupons in the newspaper for the items you regularly buy anyway before heading to the market. Those are all good consumer research techniques.

I have a system for doing this that I call my M.E.S.S. program and I encourage you, and your child, to make a M.E.S.S.!

Here is what the M.E.S.S. system is and how it works:


M: Make a List. Making a shopping list is vital because it forces you to decide in advance what you really need, what you don’t need, and what you don’t need to buy this week before you’re in the high-pressure environment of a store. It also reminds you to take measurements or inventory your supply before you leave the house.

E: Evaluate What Are Truly Basic Necessities and What Are Not in Your Household. The necessities are the basic supplies you and your family use regularly and need to have stocked at all times. I make three separate lists for this: Toiletries, Pantry, and House.

When in doubt, I ask myself, “Can I live without this?” If the object is toilet paper, the answer is obviously no. If it’s sweets for the living room candy dish, the response is yes. The list could look something like this:

Toiletries: Shampoo, Deodorant, Bar soap
Kitchen: Flour, Sugar, Coffee
House: Dishwashing soap, Garbage bags, Vacuum cleaner bags

Once you’ve established what is essential and what is not, your in-store shopping decisions are much easier to make.

Now, more about making a M.E.S.S.:

S: Shop the Ads. As suspicious as we’ve all become of most advertising, it still is the best vehicle for communicating what products and services are available at what price. Particularly for big-ticket items like a mattress or refrigerator, ads can alert you to where the best buys are. Also, don’t forget TV ads and weekly newspapers.

For me, this is the most exciting aspect of the shopping game. I view it as an intellectual challenge to hunt for the lowest price, and I have fun finding it!

S: Stick to the Agenda. It is soooooooo easy to get distracted and impulse-buy your way through a store. Don’t. Stick to your list! Be prudent about tossing (or letting young ones toss) additional items into the cart as you roll down the aisle.

Neale S. Godfrey, author of Money Doesn’t Grow on Trees: A Parent’s Guide to Raising Financially Responsible Children (Copyright © 1994 by Children’s Financial Network Inc.), writes a weekly Associated Press column and is the author of fourteen books that address money in the context of life skills and values. She has made numerous appearances on such television shows as The Oprah Winfrey Show, Good Morning America, and Today, and she is the founder of Children’s Financial Network, Inc.




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