You are probably wondering what saving as a reward actually means. The reward from saving takes a very long time to mature. This is a process that does not bear fruit from one day to the next, nor even from one year to the next. It could take five years at least to reach the prize, at times even longer. Therefore, patience is one of the greatest virtues to be strengthened and fostered.
This is what I am trying to teach my seven year old son, whose financial education I started last year, to encourage him to associate saving with reward, based on the premise that this will be achieved through effort, discipline and patience, while still having fun.
His name is Andoni, like mine, and he is learning to save with the rewards that we give him for his performance in basketball matches, races, school reports and any other incentive that emerges.
Basketball is his current passion, among many other sports. Last year he played for the school team in the youngest juvenile category. His excitement before every match was heightened, his pride in each play worthy of the most illustrious of prizes, and above all, he had fun.
This is why after the very first game I thought that there had to be some way to reward this flow of nerve and enthusiasm, to create some type synergy from this torrent of energy.
I offered him a “deal”. For each match played, regardless of the outcome, I would pay him 100 euros on the condition that he had to save that money so that it would work for him for many, many years. Until he was a grown up! By which time it would certainly be a great deal more than 100 euros. He looked at me in disbelief, without understanding, but accepted my proposal without hesitation: “OK, Dad. I agree!”
And so it transpired that the day after each basketball match, his parents would make a contribution to one of the investment funds in which he is a holder. With a great deal of dedication, perseverance and effort, in the first season he not only played the matches in his category but was selected to play in some matches in higher categories. A total of 11 matches played with enthusiasm, and above all, excitement, tremendous excitement. He had a great time.
A sport lover and astute manager
He has always been the first to volunteer to go out on the pitch, and I can assure you that he knows exactly how much money has earned and that each of these euros corresponds to a match. Besides being a sport lover, he is also an astute “manager”.
In the same way, during the last year, or academic year, I signed up to several races in my city, a “race circuit”, because I also set my own goals. There was a category for children in many of these races. Andoni asked insistently if he could run with me but he was too young. So I suggested that for each race his father completed, he would receive a further 100 euros as a reward, that he would also have to save in the same way as with the basketball matches.
Again he agreed without hesitation, and the day after each race his parents contributed the corresponding reward to one of the investment funds in his name. The first year he ran six races, proudly crossing the finish line hand in hand with his father each time.
I’m sure many of you will think this is a crazy idea, or even consider it to be wrong. I thought that he would lose interest in the deal over time, but nothing could be further from the truth. His enthusiasm has never waned and he enjoys every minute.
His astuteness has led him to seek other, more immediate and tangible rewards, as befits a child. So for each basket he scores in a match, his granddad will give him a euro. This money is a prize he can use to buy sweets and other treats. He has patiently saved up enough money to buy the shirt of his football hero.
My point is that financial education, when properly administered, can be of great benefit to children. Some of you will have spotted the reference to Robert Kiyosaki’s book, “Rich dad, Poor dad”, in this article.
I want to encourage you to teach your children and other family members about financial values, not by associating these values with a hard task that has to be done, but as something fun, that does not require too much work. This is the way to enjoy future benefits that will teach us to appreciate saving as a reward.