Teaching Kids to Handle Money: The Trip Envelope

My parents have 8 grandchildren. Two years ago, they started an annual tradition to build personal relationships with each of the kids in small groups. Every year, they take 2 of the kids on a road trip to see some national treasure like the Grand Canyon, Yosemite or Pike’s Peak.

Lion Country Safari

 

For the year leading up to the trip they have those 2 kids over for trip planning meetings to involve them in the process. Every meeting builds anticipation and excitement. Also during that year, my parents host several work days. Heidi and Caleb painted the fence (a LOT of fence.) The next year, Heather and Dub did yard work. Because of the rough, long lasting winter, they didn’t get quite as many work days in. My parents paid them in cash in an envelope for their trip.  It worked so well, that my folks recommended we do the same thing for our kids on our drive to Florida.

Lion Country Safari 2

We had envelopes for each of them with 20 crisp new one dollar bills. I forgot to pass them out at first so when we stopped for gas I gathered them around in the filling station for a chat. “I have an envelope for each of you,” I said. Their eyes got wide as they saw me take out the bills from one envelope and spread them. “Everyone has the same amount to last for the entire trip. You can spend them any way you want, but when it’s gone, it’s gone. We will provide the food for your meals, your clothing, and pay to get you into Lion Country Safari, but if you want snacks or souvenirs, it comes out of this envelope. Whatever you don’t spend is yours to keep when we get home.”

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Brandon, who is 6, took his envelope from me with a knowing look. He elbowed his brother, Dub, and said, “It’s a money test. They want to see if we are going to be wasters.” I heard a snicker and looked up at the cashier who quickly turned away and pretended to be uninterested.

A few of the children chose a frozen drink and timidly handed their money to the cashier. He paid the sales tax for them from his own pocket so they wouldn’t have to break a second precious dollar.

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It was interesting to watch the different personalities of the kids. My oldest, Heidi, saved her money and when it came time to buy a souvenir she left the store empty handed. On the way back to the car she mentioned there was a shirt that was really cute that she loved. “Why didn’t you buy it?” I asked. She shrugged. I dragged her back to the store so she could show me the shirt. It was on the clearance rack for $7 and was adorable! It was a flattering feminine cut in her favorite color and had the name of the park down the side in a tasteful but not typical fashion. “You are a super shopper, girl. Buy the shirt.” There’s a personality type that can feel guilty spending ANY money at all, even when it’s a time they should spend. Part of parenting our kids to be smart with money, is to help them find that balance.

envelope-system

My second oldest was always thinking of others. He would look for packages of things that he could share with the group and rarely bought something just for himself.

All of my kids saved most of their money for their trip out and bought tasteful souvenirs at the park. But on the way home some of them went crazy with spending. It was like they thought the money would self destruct if there was any left when they got home. We had several whispering gas station conversations that sounded like this, “That $2 piece of candy is only $1 at Dollar Tree at home. Are you sure you want to spend your money that way?” Usually those kids made good choices, but when we got home, they begged for a trip to Dollar Tree to spend the rest of their money. My older ones set theirs aside for future possibilities. When the younger ones think of something they’d really like to buy in the future, they’ll get a lesson in opportunity cost (now that their money is gone) and the value of hard work.   Those lessons are harder to learn from a lecture.

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3 Comments

  1. Posted August 7, 2014 at 12:33 pm | Permalink

    Such a great idea!

  2. katie
    Posted August 10, 2014 at 8:43 am | Permalink

    I really love that you took her back into the store to assess the purchase. Yes, sometimes things are tacky or don’t fit or just aren’t reasonable purchases, but you helped her assess the value of the item and determine it was worth it. I’ve grown so used to saving that if anything is more than the cost of a meal I almost never buy it because I’m afraid I won’t enjoy/get enough value from it. I’ve missed out on a lot of concerts or art shows because I thought I might not enjoy something enough to warrant a $20-$25 ticket. Several times I’ve regretted it, especially when I get to the end of the month and still have that entertainment allowance left over.

  3. Angela
    Posted August 10, 2014 at 9:53 am | Permalink

    Katie, You’re a true saver :). When I was little my grandma would take me to the store to buy my own birthday present and it was usually enough money for either candy or gum. I always chose gum because it lasts forever, lol. I’m trying to find a balance with things vs experiences. They are both important really, but I didn’t used to value the experiences as much. I have a great time just being with the people I love even if we are just at home. But there’s something never to forget about seeing Washing D.C. or the zoo.

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