Kids in a cashless world

Used to be that cash was king for teaching the kids, since gold coins are tangible, stackable, and you can certainly feel the pain when you part ways with them! Especially if you use a four-jar system – one each for spending, saving, giving and growing – kids can give each of those dollars a job all its own.

But these days so much happens behind the scenes as we swipe or tap our cards for everything. What money lessons are the kids absorbing?

Our brains work differently when we’ve got cash in hand than when we use a card. As my seven year old makes his way to the dairy to buy what the kids call “gay bacon”, his mind balances the pain of handing over the money with the pleasure of getting that rainbow-coloured ribbon of rolled sugar.

It’s a trade-off, and since he obviously feels it’s worth it, he lets go of the money and brings home the bacon. The feedback is immediate.

If I take him grocery shopping and pay for the real bacon with eftpos, though, there’s no trade-off for him to see – he thinks I can pick up whatever I want with the tap of a card, without letting go of anything. It’s like a parcel passed into the future, to whenever I check my balance next or get my credit card bill in the mail a month later.

All of this is not to bemoan the passing of cash or to yearn for days gone by. Like so much around money, moving away from coins and bills is not bad in itself – we just need to make the new system work for us.

Part of that will come from innovations like ASB’s new Kashin moneybox – an electronic elephant that counts savings as virtual coins are swiped from mum’s phone into the yellow toy’s tummy. There’s instant feedback as kids see their savings grow, and I can see how useful this could be when they are demanding their pay for jobs like washing the car.

Not long ago my bacon eater was having trouble keeping his money in his jars, so I created some online versions of the saving, giving and growing jars to give him a hand. Here’s where the digital world has its advantages: since he didn’t see his coins all the time, he couldn’t raid his jars and was definitely impressed when I showed him how much he had stashed.

It was out of sight, out of mind, and all the time growing in the background. Sounds like a lesson for grownups, actually.