It's never too early to learn financial responsibility.
From the moment children are born, parenting is about finding balance. Balance between the demands of work and family. Between keeping children in a safe cocoon and allowing them to experience life on its own terms. Between unconditional love and discipline.
As children mature into teenagers, it gets more difficult to strike that balance where finances are concerned. How much money should parents give to their children? How much should children be expected to earn for themselves? How can children learn financial independence while getting the support they need?
Marcee Hartzell, an STCU community development officer, says it comes down to jeans. Not genes. Jeans.
Needs v. wants.
"I have a teenager, and we have hard discussions with her," Hartzell says. For example, about a pair of jeans that cost more than $80. "I don't normally spend that much money on jeans, no matter what, and these were holey and torn up."
So she and her daughter talked about setting priorities, about fashion's fleetingness, about the money that couldn't be spent on other things if it were spent on a pair of preshredded jeans. "What's important about those jeans, and why? Is it the name? Is it the store? What if they rip?"
Eventually they reached a compromise. Hartzell would pay $25 toward the jeans if her daughter covered the rest.
"She saved up all of her birthday money. All of her Christmas money. She even saved the money she got at Easter," Hartzell says.
Hartzell's daughter bought the jeans she wanted, and her parents were able to make their points about personal budgeting and drawing the distinction between luxury items and essentials.
"For us, it's about the save, share and spend model, and how you make decisions with your money," Hartzell says.
It starts with education.
On behalf of STCU, Hartzell regularly goes into elementary, middle and high schools, teaching young people about financial responsibility and the value of a dollar.
"The path to financial security begins as kiddos," she says. "For us, it's about the save, share and spend model, and how you make decisions with your money. Is it a need or a want? What is saving and what is investing, and what are the differences? And if you start early, what does that mean?"
A game she plays with high-school audiences shows two investment trajectories, one starting at age 20, the other at 35. Over the decades, the two trajectories begin to separate by hundreds of thousands of dollars.
"It blows their minds. When they see that chart, you can see their eyeballs flash," Hartzell says. "It really hits home, and one of the things we roll into that is the concept of retirement."
She also lays out the benefits and pitfalls of credit cards, the importance of establishing a positive credit history, and the vital need to save for emergencies as well as big purchases. Some of that can be reinforced at home by involving children in the household budget.
"I know that when I grew up, you never talked to your parents about how much money they made, how much they spent and how much things cost. It was just off the table," she says.
"But that's something we're trying to promote — having those regular conversations. How do we save throughout the year to pay the $1,500 bill for soccer dues? We can go out to eat with the whole family, but it's going to cost us $150 for one meal. Would that be better spent at Silverwood or on our vacation next month?"
Hartzell says those budget-related conversations should carry on into college, when expenses are greater and "setting the boundaries" becomes more important for family and financial harmony.
The financial life lesson didn't end with Hartzell's daughter buying the jeans. Thrilled with her new threads, she wore them to school the very next day. While changing back into them after gym class, she put her foot through one of the holes. The pant leg ripped off.
"When I picked her up later that evening, I asked how her day went. She instantly started crying. She held up her jeans, first one pant leg and then the other. 'They're just jeans,' she said. 'I don't know why I had to spend $80 on a pair of jeans.'
It wasn't the outcome either of them wanted, but talking openly about the purchase beforehand meant that they were both able to see things from the other's point of view. That mutual understanding — plus a bit of humor — left each of them with a better appreciation for the balance of the parent-child relationship.
"As a parent, being a role model — and a financial role model — is one of the best ways to help my children," says Hartzell, laughing. "That and letting them make affordable mistakes."