There were so many questions from yesterday’s post on Homeschool Finance, that I decided to do a follow-up post today and explain a few things:

Mike asked: Have you calculated the option cost of having your spouse at home teaching your children instead of working full time or part time?

Good question. My wife stays home with the kids and actually makes money by watching other children in our home. Some of you will remember that Mrs. Stew almost worked outside the home this year, but we were going to get free tuition/preschool for our children as a benefit to her job. At the last minute we decided that she would stay home. I doubt whether Mrs. Stew could get a job that would justify the up front expense of work clothes, a second car, child care, etc. and still bring in money. Providing child care in our home has been great for our finances.

Given the ages of our children, I think that a stay at home wife is overall a cost savings. That might change as they move into junior high and high school.

Greg stated: The one thing you left out was the cost of home school curriculum. This can be very pricey. The savings on clothing (you still have to buy clothes), transportation (field trips, library visits), and food (you don’t need to buy lunch at school and you can use reusable containers) is negligible to the cost of the curriculum.

The truth is that our curriculum is free! Our state provides a free online curriculum and so far, my wife and I have been pleased with it . . . well, it is not free . . . might be more accurate to say that it is paid for by the good tax payers of our state. The online curriculum provides a schedule and accountability. Yes, we do have to buy clothes, but they definitely do not get the wear and tear that school brings. There are some transportation costs to field trips – but only once or twice a month – and the library is within walking distance. My intent was not to list all of the expenses due to homeschooling, but rather just a list of the ways that we save money.

Gina’s question was interesting: If you have “other” students, would you charge a nominal fee to cover the curriculum costs? Would other students require more licensing (such as w/a daycare)? What sort of creditentials are involved w/being a “homeschool” teacher?

I think they are called “homeschool co-ops”. I know that the homeschoolers in our old church used to use the church facility once a week to meet and bring in a teacher to handle specialized subjects that some parents found difficult. We are not currently involved in anything like that, however, Mrs. Stew often gets the kids together with other homeschool friends of ours for playdates. This might eventually turn into some sort of co-op. The definition of what constitutes homeschooling is defined by state law and is different in almost every state.

Evan asked: What about the lost socialization with other students around their age? Beyond siblings?

I think this concern is valid, but often over-stated. Our kids play with other children on a regular basis and we are faithful to church, so there is socialization there. As they get older, we hope to involve them in community and club sports as well. Furthermore, there are some peer influences from which we would like to shelter them – at least for a little while longer.

The bottom line is that while there was a financial component to our decision to homeschool, this was not the only factor. Many pros and cons were weighed. One factor that is not financial is the fact that my job allows me to participate in homeschooling. I teach thirty to forty percent of the material in order to give Mrs. Stew a break. If my job ever changes so that I can no longer bear part of the burden, our kids will probably go back to school.

Any more questions?

Article by Stew

Photo by lepiaf.geo

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When my wife and I started to have children, we never thought that we would end up as homeschoolers. This year we are just that. We have a first grader and a kindergartener and we are educating them at home. I do not want to get into a long discussion about the pros and cons of homeschool v private school v government school. The bottom line is that we believe this is best for our children at this point in time and in the future, circumstances might change that will cause us to reconcider and possibly even choose one of the other options. Today, I just want to talk about the financial aspect of this decision.

Here are the ways that we save money by homeschooling:

• Clothes. We have been able to avoid the cost of clothes brought on by a dress code (some private schools) and by peer pressure. Our kids go to school in their play clothes and we save some money this way. I think the greatest area of savings is in shoes.
• Transportation. We do not have to drive our children to and from school. Getting to school is as easy as walking downstairs.
• Food. We do not have to buy the school lunch and we even save money on packing a lunch since lunch at home does not require a lunch box, sandwich bags, beverage container or even the proverbial “brown bag”.
• Tuition. This is the obvious cost savings over private school. Public school would not require us to pay tuition, obviously.
• Fundraising. All schools, public and private, require students to raise money for one thing or another. We do not have to deal with selling candy bars, magazine subscriptions or participating in any other ways to bring in money to the school.
• School supplies. Our kids share school supplies and many of the things that they use are items that we already have around the house.
• Vacations and travel. Because we are not bound by the school year, we are able to travel at “off-peak” times of the year. We save a lot of money by booking flights on week days or staying in hotels on school nights.

We did not chose to homeschool because it was the cheapest option. We chose it because in light of all of the circumstances, it is the best educational choice for our children. I am thankful to live in a country where we have the freedom to educate our children at home. While there is a financial component to the decision to homeschool, I certainly believe that it is important to invest in education and hope to have the money  in the future to spend on the best education possible for my kids.

Article by Stew

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As many people during these tough times, we are cutting out extra’s in order to make ends meet financially. We are doing everything possible to not add debt, to make our current income go farther and to try to increase and diversify our revenue streams. One of the items at which we are looking critically is vacations.

My wife and I have been married for almost nine years and we have yet to take what many people would consider a major vacation. I’m talking about a cruise or Disney or some kind of resort. A vacation where money is spent on travel, lodging, food and entertainment. Throughout our marriage, our vacations have basically consisted of traveling to visit family and maybe staying one night in a hotel en route. There have also been some instances where I have taken my family along on a business trip – my vocation allows for this from time to time – not really a vacation, but I think it feels like one to my family. We hope to someday take a major trip, but we have a lot of other financial priorities before that happens. Here are some thoughts as you consider different options for some R and R.

The first question is, do you need a vacation? I’m not kidding, our culture has conditioned us to see vacations as normative. Everybody goes away for a week or two, don’t they? The reality is, that as our economy changes, we might see fewer and fewer opportunities for vacations – and fewer options due to the expense. Prior generations rarely (if ever) took vacations. The family farm did not allow for it. Most of the vacation spots did not exist. Tourism was an option for only the super rich. For most of us, time for relaxation is a necessity, but a travel vacation might not be a necessity.

I think my number one recommendation to someone who is considering a vacation is, do not finance your trip! I can’t believe the number of people who go into debt for a vacation. Even a honeymoon is not important enough to take out a loan. We have all seen the home equity loan ads or received the credit card “checks” that suggest that you pay for your next vacation after you get back. Dumb idea. Take a trip that you can afford, better yet, save up for it in advance.

The second suggestion is to figure out your mission. What is the purpose of your vacation? Is it just rest? You might be better off staying home, sleeping in and going out to eat every night to give your household cook a break. Are you taking an educational vacation? I know, sounds nerdy, but I would love to visit an old battlefield or Washington D. C. and just read every historical marker I see – maybe you could stay with friends or family for a trip like this. Are you looking for an adventure vacation? Whitewater rafting, backpacking, water park are all great options, but remember that you might come home more tired than before you left. Maybe you want a decadent experience with lots of luxury. Maybe you are celebrating a special occasion – these are all great reasons to take a trip if you can afford it, but it is important to think about the purpose of your trip so that you can budget appropriately and so that you do not get to the end of the week and have regrets.

My family’s recipe for a frugal vacation right now?

• A clean hotel booked on a week night and through a website that offers discount rates.
• A good free breakfast in the hotel.
• A swimming pool is a must. My kids are happy to swim all day.
• A cooler to store food for lunch – we only eat out once a day.
• We really try to get a two-room suite so that we can put the kids to bed early . . .

I know that my children will not always look on a 36 or 48 hour hotel stay as a vacation, but until their expectations get a little more sophisticated, we are more than happy to spend quality time in the hotel swimming pool.  - Article by Stew

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All of us come from different family financial backgrounds and those experiences shape who we are today. I was brought up in a household where money was in scarce supply, but even more scarce was any discussion of money. My parents almost never discussed finances. Even though they were successful at handling this important tool, they did not do the greatest job in teaching their children about money.

The positive result of this method was that I left home and went through college and entered my career without being obsessed with money or without a bent toward serving money. Salary was never a factor in my parent’s occupational decisions and salary has never really been a factor in my job decisions. This is one of the reasons that both my parents and I have worked almost exclusively for non-profit ministries. The other positive of this approach is that my siblings and I grew up mostly without a television, video games or vacations to exotic locations. Furthermore, we never pined for such things because we did not know what we were missing. We read, played hard outside and went camping a lot. We never really coveted the lavish lifestyle (by comparison) that some of our peers lived. We did not think about it; money was never a part of the daily conversation.

For most of my youth, my dad earned money on the side as a carpenter. When school was out, my brother and I would go with him to the job site and from the earliest ages, we found ways to help out with simple tasks and then more complicated as we grew and became more skilled. He never paid us. We never talked about money – we thought it was fun to work with our hands out in the sun all day with our dad. It sounds ludicrous, but I remember the first time that I helped out a different contractor for a couple of days and he wrote me a check . . . I couldn’t believe it. I was actually surprised that a person could have all this fun and get paid for it too. I think I was a sophomore in high school and it ruined me for working with dad.

We never expected money when we worked on a house with father, but my brother and I did earn extra money by shoveling snow, mowing lawns, raking leaves and other odd jobs. But we were embarrassed by any discussion of money. We would knock on the door, ask if the person would like their driveway shoveled. If the answer was yes, we simply went to work and left the level of pay up to that person. Sometimes we were even squeamish about knocking on the door when the job was done in an indirect reminder or a non-verbal request for payment. We just hoped the person would notice that we were finished and lean out of the door with a check or some cash. I know that at least once, we left a freshly shoveled driveway and just walked home rather than go through the excruciating pain of asking for payment.

I come from the kind of family that tips even when the service is poor and if the server makes a mistake with my meal, I eat it and pay for it anyway. For some reason, the subject of money was as taboo as sex.

On the other hand, as I look back, I wish that I could have known more about how both of my parents spent the money that they did have. My dad never told me what he made in a year, althought I’ve pieced some of it together since then. He never showed me a monthly budget, althought I knew he had one. He never showed me how much he spent or saved or invested. If I asked him for an item that I thought I needed, he would either say “no”, “maybe” or “buy it yourself”. When it came time for me to file taxes for the first time, I remember that my father handed me a 1040EZ and said “figure it out”.

I left home without a burning desire to be rich – a good thing. I was content to live a simple life with the money that I had. As a result, I was fairly successful at handling my money when I was single and in college. However, when I got married, started having children, and started to develop more expensive taste – the wheels started to fall off our money wagon. The thing that I had missed was how to be an intentional steward of my money. I did not know how to create and execute a financial plan for our family.

I know now that my father was good at budgeting and good at spending money wisely. My mother fed and clothed five kids for little money for years. They both had great frugal habits, but those habits did not do me any good because I didn’t know about it. I hope to intentionally train my children to handle money wisely.

What were the pros and cons of your financial upbringing?

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We’re almost half way through summer break and I don’t know about you but our kids are getting bored to death already.  We’re constantly on the lookout for frugal or fairly frugal things we can do with our kids.  We’ve been hiking, visited the library, visited historical areas and a number of other things.  My wife had a great idea a few weeks ago: build the kids a fort.

She gathered up all of the scrap lumber I had around the house (which seems to be a lot for some reason), all of the nails and screws I had and got the kids together to start building a fort/play set for our younger kids.  The design was simple: just a small deck with railing and a slide.  I didn’t help much, as she wanted this to be something that her and the kids did, so I stayed out of it the best I could.

The kids had a blast and the project kept them busy for a few days.  I was in the house working most of the time, but constantly heard the sounds of little hammers, saws and my cordless screw driver.  Every so often my wife or one of my kids would come in and ask me question about how to do something and then head back out to build some more.

As it turned out, their wasn’t enough supplies here at the house, so in the end she ended up putting about $100 or so into it to cover the cost of the plastic slide and the additional wood that was needed.  Worthwhile investment though, as our kids learned a ton from doing it:

• Since they went with Mom to buy the supplies, they very quickly learned how much wood, nails, screws and brackets cost.  They were shocked that wood cost that much.
• They learned how important it is for something to “square” which leads into the next learning…
• They now understand that when building something if you don’t do things correctly the first time, what seems like a little mistake slowly becomes a very big mistake later as you build onto it.  As a result, the platform is a little crooked.  It’s solid though, so big deal.
• I think the most important thing they learned was they’re mother is far more knowledgeable about stuff than they thought.  Until this project, they had always only seen me build things, never my wife.  My wife is pretty handy though and while not perfect, overall I think her and the kids did an awesome job.

So, looking for something to do with your kids over the summer that will help teach them about money, construction, team work, and doing things right the first time?  Build a simple “fort”.  It will keep them busy for days AND give them a great reward at the end.

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Kids are famous for complaining to their parents that they are bored or that there’s nothing to do. A lot of adults who have recently switched over to a frugal lifestyle are starting to sound just like those kids. They simply don’t know what to do to entertain themselves if it doesn’t involve spending any money. Well, just like your parents told you when you were a bored kid, there’s plenty to do if you get creative.

Here are some of the best free events for kids that you can enjoy in almost any place that you might live:

• Outdoor adventures. Hiking, camping, picnicking and reading in the grass are all activities that don’t cost you anything. They can be done just about anywhere especially during the summer. If you live near a lake, river or national park then you have even more options.

• Other outdoor events. Nearly every small town offers planned outdoor events for the community. Outdoor movie screenings, plays in the park, Farmers’ Markets, craft fairs, youth sports events and concerts are all examples of things that you might find offered for free in your area.

• Arts and cultural events. There are a lot of free events that are great if you’re interested in arts, literature or learning in general. Lectures at the local library, open mic nights in your town’s coffee shop and opening receptions at art galleries are all examples of free events you might have fun at. If your town is too small to offer these things, check in the town closest to you and plan an inexpensive day trip.

• Window shopping and people watching. Sometimes it’s fun just to get out and be around other people. Browse through antique stores or malls without buying anything. Sit in a public space and make up stories in your mind about the people that you see there. Daydreaming doesn’t cost a dime.

• Get-togethers with loved ones. Host a potluck dinner. Have a home movie viewing at your house. Put together an impromptu game of touch football in your backyard. You can have a great time with the people you love and you don’t have to spend any money.

Stop complaining that you’re bored because you don’t have money to spend! You don’t have to spend money to have a good time. Look for free events in your area. Just get off the couch and get creative. You’ll be surprised by how much fun you might have.

Guest article by Kathryn Vercillo. Kathryn is a writer for Promotionalcodes.org.uk which gives away free voucher code deals (like this Debenhams promotional code) and also publishes money saving tips.

Photo by: pawpaw67

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I know that many of us are still recovering from the long weekend, so my post is on the lighter side today. I spent a lot of time outside over the past few days, believe it or not, my day job required me to work Friday night, all day on Saturday, all day on Sunday and most of the day on Monday . . . Fortunately, my services on Monday were not needed at the last minute, so I was able to enjoy some time with my family yesterday.

But I couldn’t take the whole day off – a blogger is always on the lookout for article ideas – I brought my laptop to the supper table last night and asked my kids some questions about money. (Just so you know, I don’t bring my laptop to family meals very often, although my Blackberry has been known to put in an appearance or two.) I proceeded to ask my daughters some questions about money. Daughter #1 is six years old and just finished kindergarten. Daughter #2 is newly five years old and will be starting school in the fall. I have recorded the answers as close to their own words as possible. I don’t think the answers reveal anything revolutionary, but I still found them interesting. Maybe you can spot a moral or a trend . . .

What is money?

1. Cents and dollars
2. Coins are round and dollars are rectangled shaped

How do we get money?

1. From factories; by paying and then they give you money back
2. From selling stuff

What do we use money for?

1. For buying things
2. For buying stuff

How much money does Daddy have?

1. I think maybe eleven dollars
2. A hundred dollars

How much money does Mommy have?

1. Seven pennies
2. Twenty-seven pennies

Who has more money, Mommy or Daddy?

1. Daddy, I think because I said $11 and Mommy only has pennies.
2. Daddy

What does Daddy buy with his money?

1. Socks, tshirts and he just bought a new phone
2. New tshirts and new soccer hats

What does Mommy buy with her money?

1. Food for us and clothes for herself and toys and clothes for me and my sister
2. New church dresses and pretty shoes; party stuff for my birthday party

What is a person called who has a lot of money?

1. Rich
2. A rich person

What is a person called who does not have much money?

1. Poor
2. A poor person

Are we rich or poor?

1. Poor Why? because we don’t have a lot of money right now, I know that because mommy hasn’t been buying a lot of things except food
2. I think rich Why? because [#1] has money in her piggy bank and I have money in my piggy bank; and poor people don’t have any food and we have food

What is something good to spend money on?

1. Stuff that we need, like food and clothes
2. My friend bought me “Puppy in my Pocket” for my birthday. That was good

What is something bad to spend money on?

1. Toys and coffee
2. On stuff that we are buying for dinner and we have a friend for dinner and the friend doesn’t like the stuff that we bought, that was bad to spend money on

Can we buy things when we don’t have any money?

1. No
2. No

What is a credit card?

1. Something where you don’t have to pay, you just give it to them and they slide it down the thing and then give it back to you or you use a coupon
2. A card for buying stuff

What kind of stuff do we buy with a credit card?

1. More credit cards or clothes
2. Stuff that mommy wants for our room

What should we do if we don’t have enough money?

1. I would ask someone for more
2. Wait until we get more

What should mommy save her money for?

1. A new phone
2. For buying stuff that she wants

What should daddy save his money for?

1. A car for him, maybe a truck
2. For buying a t-shirt that he wants

What would you save your money up for?

1. Laura Ingalls books for myself
2. A new dolly

How would your kids answer these questions? Can you think of any more questions that I could have asked my kids?

Picture by laurenatclemson

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I remember the first time I saw my father use an ATM or automated teller machine. I can still remember the name of the bank my parents used and picture the whole ATM setup in my mind – right down to the now-ancient looking digital numbers on the screen. I was quite inquisitive about how a machine could spit out cash. I mean, how much cash must have been in that metal and plastic box? Or did it print the money on the spot? Was there a tube leading from the bank vault that kept the ATM loaded with cash? Why was there a $200 withdrawal limit? Why were ATM bills so crisp? What if I watched closely and figured out my dad’s pin number?

I remember, though, that my father was careful to explain to me that this was not just money from a machine, but real money that came out of his bank account. No one had really ever heard of a credit card at this time, so the ATM was a pretty big deal in the cash or check society of that day. The other vivid memory that I have from this time period was paying for gas with a $10 bill and developing the skill to make the pump stop exactly on $10.00, so that you would not get a penny in change or have to search through the car for an extra nickel or dime. But I digress. (Boy, I sound old sometimes, don’t I?)

Even though my father used the ATM from time to time, he was most definitely not an ATM parent – at least when I was at home. By the time my younger brothers and sisters were older, my parents were earning a little more money and probably saving more, since I was not there to eat everything in the house. They were probably most generous in regards to my baby sister whose wedding is coming up in a month. She is 13 years my junior and let’s just say that if money was love, my parents loved her more. . . or did they? hmmm . . .

What is an ATM Parent?

From the context, I was pretty sure that I knew what an ATM parent meant, but let me develop and define this term a little bit. I am making assumptions and speaking in generalities, this is not meant to be completely literal in every part. The truth is probably that many of us will identify with some parts of this list more than others.

If the shoe fits, wear it:

ATM parents allow $5’s, $10’s, $20’s and $50’s to flow freely without accountability.

Children of ATM parents often know their Christmas and birthday presents in advance. The prospective toy is always something fantastic and ATM children love to proclaim it loudly at the lunch table or on the bus. There are times when I wonder if the future gift is something that the parent promised to the child in order to get him to behave.

ATM parents want to make everything in life as fair as possible for their children.

ATM children grow up thinking that tanning, facials, designer jeans, summer camp and expensive basketball shoes are not luxuries.

ATM parents are not necessarily rich, but most seem to struggle financially – whether or not they make $30K or $250K annually.

ATM children do have piggy banks, but they are empty.

ATM parents rarely say no, but they often make a counter-offer.

ATM children know that money does not grow on trees, however, it does bloom whenever they tug on a parent’s sleeve.

ATM parents feed the instant gratification habit rather than delayed gratification.

ATM children believe that saving up for something means telling their parents what they want a month in advance.

Does your child know that if ATM father says no, that ATM mother might be willing to contribute?

ATM children carry credit cards for which they never see the statement.

ATM parents assume that the automated teller machine should also pay for college and then room and board after college.

Can you add to the list? Am I raising children who have ATM tendencies? I hope not. Are you raising ATM children or – gasp!- Credit Card kids?!

By the way – there is absolutely nothing wrong with an ATM grandparent.

Photo by: frankh

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In today’s busy and hurried society, we want everything now.  Think about some of the “instant” things we have in life.

On-demand TV programming.  30-minute 30-second meals.  Instant messengers. Drive-thru options for just about any store (because who wants to get out of their car for anything?!).  The list goes on and on.

We want what we want, and we want it now.

Welcome to America.

But if we were to go through each of our closets, dig under our beds, or browse around our attics, we would find plenty of items that would fall into the category: “I just had to have it.”

Except that you didn’t.  You used it or wore it once or twice, and it has collected dust ever since then.

Delaying gratification isn’t just a money principle, but it’s a life principle.  Think about it.  Which tastes better?  Something cooked in the microwave or the crock-pot?  Hopefully you said the crock-pot as you pull your frozen pizza from the microwave!

But how do you get a teenager to understand this?

• Lead By Example – Teenagers watch to see if you’re living out what you’re telling them to do. If you always have to have the latest and greatest and never delay gratification, don’t expect your child to do it either. Here’s a good question…are you smoking what you’re selling? (Can he say that!?)

• Just Say No – When your teen comes to you asking for $50 for that new outfit, an advance on their allowance for the new iPod, or wondering if they can sell their younger sister on Craigslist for some extra cash, just say NO! I’m sure they’ll kick and scream and foam at the mouth, but they will also begin to realize having that new item isn’t that important.

• Implement A Waiting Period – You may have heard this before, but anytime you’re making a significant purchase, give yourself a few days to think it through and prevent yourself from buying on impulse. When you leave the store and wait a few days, it will cause you to think clearer and use better judgment. Teach your teen to wait for it.

12 Things Every Teenager Needs To Know About Money (And How To Teach Them) is a community blog experience.  This post is only one of the 12 points in the series so to view the other 11, please visit the list of links below.  Here are the rest of the articles in the “12 Things Every Teenager Needs To Know About Money (And How To Teach Them)” series:

• Money Doesn’t Grow On Trees @ Bargaineering.com
• Two Words: Compound Interest @ PoorerThanYou.com
• Delay Gratification To Succeed @ GatherLittleByLittle.com
• Living On A Budget Isn’t An Option @ TotalCandor.com
• Credit Cards Will Steal Your Lunch Money @ PTMoney.com
• Should You Earn A College Degree? @ TheDigeratiLife.com
• Spend Money Based On Needs Not Wants @ MoneyNing.com
• There Is More Free Money Than You Realize For College @ FreeFromBroke.com
• Living On Your Own Isn’t Cheap @ Studenomics.com
• Taxes Are A Necessary Evil In Life @ MoneySmartLife.com
• Do What You Love, Love What You Do @ GenXFinance.com
• Don’t Be A Tightwad: Give Generously @ CashMoneyLife.com

This is a guest post from Grant Baldwin, the author of Reality Check, a book about helping students transition into the real world.  His new website, BrokePiggy.com, answers questions from teenagers about personal finance, savings, and all things money.

Photo credit: TheTruthAbout…

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We have read short-story books to our children since they were able to sit still, but lately we have been sharing longer books with our daughters in the evenings. We are reading a chapter a day from the Little House on the Prairie series by Laura Ingalls Wilder and our five year old and six year old are currently enjoying Farmer Boy. Laura Ingalls Wilder books are certainly not cutting edge fiction or drama, but they have a charm that winds up being a good way to end the day. The stories are from a simpler time when all one had on which to depend was family, neighbors, God, and the ability to work, work, work. The accounts of the amount of labor required just to make a meal, much less run a farm is nothing short of amazing. The Wilders farmed in upstate New York in the 1850’s and everyone in the family worked long hours from the earliest age. The story is set when Almanzo (Laura Ingall’s future husband) was nine years old.

As I was reading aloud a few weeks ago,  Almanzo’s father gave a great lesson on the value of money to his son. The chapter is too long to print here here completely, but you can find the whole story on Google or Amazon if you would like to read the excerpt in context. I will summarize:

Almanzo was in town with some of his friends on a holiday. One of his friends, Frank, wanted a 5 cent lemonade, so he asked his father for a nickel and purchased the beverage. Apparently, Frank asked his father for money all the time and usually received what he asked for. Almanzo wanted a lemonade too, but knew that he was forbidden to ask his father for money – until his friend “double-dared” him to ask for the coin. Under pressure from his friends, Almanzo summoned the courage to approach his father. The man to whom his father was speaking said, “The boy’s too young, Wilder. You can’t make a youngster understand that.” However, Mr. Wilder thought Almanzo could understand:

“Say you have a seed potato in the spring, what do you do with it?”

“You cut it up, ” Almanzo said.

“Go on, son.”

“Then you harrow – first you manure the field, and plow it. Then you harrow, and mark the ground. And plant the potatoes, and plow them, and hoe them. You plow and hoe them twice.”

“That’s right, son. And then?”

“Then you dig them and put them down cellar.”

“Yes. Then you pick them over all winter; you throw out all the little ones and the rotten ones. Come spring, you load them up and haul them here to Malone, and you sell them. And if you get a good price, son, how much do you get to show for all the work?” How much do you get for a half a bushel of potatoes?”

“Half a dollar,” Almanzo said.

“Yes,” said Father. ” That’s what is in this half-dollar, Almanzo. The work that raised half a bushel of potatoes is in it.”

And then to Almanzo’s shock, Father reached into his pocket, pulled out a silver half-dollar and handed it to him.

“It’s yours,” said Father. “You could buy a suckling pig with it, if you want to. You could raise it, and it would raise a litter of pigs, worth four, five dollars apiece. Or you can trade that half-dollar for lemonade, and drink it up. You do as you want, it’s your money.”

Not only had his father given him money after merely being asked, he had given him ten times as much as Almanzo had asked for. Needless to say, Almanzo when showed all of his friends the shiny coin, they were duly impressed, but no lemonade touched his throat that day.

The truth was that Mr. Wilder gave to Almanzo a far greater gift than 50 cents. The value of money is representational – it is an abstract concept that is difficult for children to understand. Almanzo did not understand the value of money, but he understood the value of hard work. Almanzo’s father had spoken in terms that he knew that his son would understand. Nine-year old Almanzo came to understand  the value of money at a young age and it is possible that he understood it better than many adults of today. He learned that

• money is valuable.
• money represents work.
• money is not always valued by everyone else.
• short-term financial discipline leads to long-term gain.
• satisfaction and happiness does not come from money.
• contentment does not come from the things that money can buy.
• if money is properly cared for, it will grow.

This story challenged me to re-evaluate the financial education that I am giving my children. I had to wonder whether or not my children understand work. Have I made plans to show them how to work so that they can learn to value money? What can I use to demonstrate the worth of money? Have I taught them to wait and save or do I encourage a habit of instant gratification?

What other lessons can we learn from the story of Almanzo’s fifty-cent piece? Can you suggest any modern-day ways to help your children understand the value of money?

If you have young children at home and would like to read a good story with them, I recommend Farmer Boy and the rest of the Little House on the Prairie series.

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