One time financial instruction – the kind children might receive in a classroom – has been shown to wear off relatively quickly. It tends to cover concepts too far in advance of when a child will actually be able to see ideas and formulas working in real life. Analysis of over 200 studies last year proved this.
John Lynch, Director of the Center for Research on Consumer Financial Decision Making at the University of Colorado, Boulder believes these findings support the case for just-in-time financial education. You can read more about the studies and conclusions Mr. Lynch and others in his field drew in the WSJ article highlighted below. Why are we drawing attention to them here? Because Gifting Sense offers exactly what Mr. Lynch suggests – financial education just as children are considering a purchase. And the number of purchases kids ask their parents to consider is never higher than as holidays or a birthday approach.
Gifting Sense offers just-in-time financial education, the type that helps develop lasting financial literacy, by requiring kids to quickly but purposefully think before they buy.
If kids spend 2 minutes on Gifting Sense to figure out the cost-per-use or wear of an item, or the total cost of an experience, and then generate a DIMS (Does It Make Sense) Score – before they ask their parents or guardians for an upcoming holiday or birthday gift – they will be getting quick but meaningful money management lessons. Experts like Mr. Lynch have discovered that this is the best way for our kids to develop lasting financial literacy.
“Let’s say you want to teach your child about budgeting, and you know that every year, Aunt Ethel writes your child a $50 check for Christmas,” says Mr. Lynch. “The moment to talk about budgeting is just before that happens. If you have that conversation a few months before or a few months after, it’s not going to have an effect.” The time to underscore that things like Driver’s Ed and insuring a new driver, can equal the cost of a vacation, is just before a 16th birthday, not years before, in anticipation of that cost, or years after, reminiscing about it.
Gifting Sense was created to help parents and guardians teach their kids to think before they buy and reduce waste. If you want your kids to stop repeatedly asking for money or gifts without seeming to understand their true value, ask them to take 2 minutes to answer 10-12 questions the next time they are making a wish-list. As our name suggests, we believe helping young people develop lasting money-smarts is one of the best gifts parents can ever give their children. Hopefully you have read this “just-in-time” to start giving your family financial literacy with their next holiday or birthday present.