The Daffodil Project
I often hear that people think we should be teaching kids about money at school. Opinion is that it should just be on the curriculum like maths, english, arts or what have you. And I do completely agree with this. But, the fact is that good money management is not being taught in our schools YET. I know there are a number of groups and companies working on this so hopefully things might change in the future. As long as one of those companies wanting to ‘teach’ our kids is not a bank trying to push their own products, I’m all good with kids being taught about dosh in school.
But, in the meantime (which, lets face it, change moves extremely slowly so I’m thinking about my daughters entire schooling here), I’m gently working on teaching her myself and I figure I have from birth till about 17 to do it. Drip drip drip, there is no escape from Mummy’s nuggets of wisdom for my child.
I’ve blogged before about ways I teach her to be good with money and it remains a regular topic in our house. She is ten now and although she still does not fully comprehend why on earth people would borrow money and pay interest, thus paying back more than they borrowed, aka a mortgage, she does understand a lot of other stuff. And I’m always looking for opportunities to teach her more and I thought if you have children of your own then you might like to see how I go about it?
I got an email a few weeks back from one of the many companies I’m subscribed to. They were selling daffodil flower bulbs at a special rate: 100 bulbs for $45, delivered. I instantly saw an opportunity to teach my daughter and asked her if she wanted to have a go at selling bulbs to her grandparents, friends and neighbours for a profit?
“What’s a profit” she asked? The lesson had begun!
Together we ordered them online, she filled out the order form and typed in my credit card details and pressed “order now”. Fear not, I’m not just teaching my daughter to be an online shopper (although she did take to it like a duck to water). A week or so went by and the product duly arrived which was pretty exciting.
Now for some planning…
Together we worked out that each bulb cost us 45 cents to purchase. So she had to sell them for more than that in order to make some money i.e. a profit. Some online research of The Warehouse and Mitre 10 showed her that other bulbs like hers were selling for between 40 cents and $1.39. Thankfully she quickly grasped the concept of why selling at a loss should be avoided.
We played around with all sorts of scenarios with each showing a different profit.
Finally she settled on $1 per bulb as it would make for easy math and rewarded the effort she was going to put into the project. She would make 55 cents per bulb.
However, when we talked about her paying for the cost of buying the product in the first place, which was $45 she was a bit crushed when she did the math and worked out how much LESS profit she would make once she paid me back for the cost of the bulbs. And this is where I am a complete walk over. Because she was getting so genuinely involved in every step of the process I decided that, to me, this was $45 spent on a good education and that any money she made would be hers to keep, but with a few strings attached. She was of course delighted with this! She can also spot an extremely good deal when she sees it.
She quickly worked out that she would now make $100 if she sold all 100 bulbs. An enormous sum of money when you are ten (or 44). We decided that it would be a good idea to create packs of 5 bulbs to sell for $5 a pack. Conversations began about going out and buying containers to put the bulbs in, but that would cost money and would eat into her profit. Out came the origami paper to make up some bags, but they would be too small to hold the large bulbs. So finally, out came the sewing machine, iron and fabric that we already had and a production line began where she sewed up 20 gorgeous wee bags to hold the bulbs. And she learned to iron (which is an extremely rare occurrence in our house) and also to ‘drive’ the sewing machine all by herself so yet another new skill learned there! Total packaging cost $0. Total fun $priceless!
Next this became a whole family exercise when we discussed making some labels. If she were to hand write 20 labels it would take her ages so instead she sat down with Jonny, who is of course a graphic designer and they created a label with information to give to each customer on what type of bulbs they are, how and when to plant them etc.
And importantly, seeing as she is going to be approaching neighbours she needs to clearly say where the money will be going. Honestly, so many great conversations came up during this enterprise and one of them was explaining to her about transparency. Most people would assume she was fundraising for her school, so in her ‘sales pitch’ she had to clearly explain that this was not the case, but instead:
- 10% of sales would be going to her charity of choice - The Alexandra SPCA
- 45% would be going into her savings account - because her Mum makes her save 50% of everything she earns (after charitable donations)
- 45% would be going to her upcoming holiday to Vietnam
After a very industrious afternoon of sewing bags, filling bags, designing and printing labels she was ready to launch. We had role played the scenario of her approaching a front door, knocking, being polite and telling the person (me) what she was selling, why and how much and she had it down pat pretty quickly. And who are the best people to test your finished concept out on? Yip, very obliging grandparents who also like to garden. So we FaceTimed them (we even had the camera trained on her as she knocked at the front door and did her spiel) and they of course bought some. Four bags in fact! She was beside herself!
After we hung up she was quick on the maths:
“Mum, 4 bags x $5 = $20. Thats $2 to the SPCA, $9 into my savings account and $9 towards my trip.”
My daughter claims not to like math and that she is not good at math. I recall thinking the same when I was at school (mainly because I did not like math and was not good at math) so I’ve always been determined to tell her instead how much I LOVE math and that math is IMPORTANT. Jonny on the other hand is more straight up and tells her that he sucked at math at school! Not helping Jonny, not helping!! She had to do a lot of simple math for this and it was great to see her think about it and problem solve it - all the while not even realising she was competently doing one of the things she claimed not to be good at!
As the week progressed sales rolled in as she approached friends and neighbours and a group that turned out to be her best customers - her school teachers! And once again this had to be lead by her. I could have sold them all for her in a heartbeat, but I wanted her to do it herself and although really really nervous to begin with she got more confident with each sale. In fact I did inadvertently sell one bag to a friend because after I explained to her what we were up to she wanted to buy one. My daughter was annoyed at me because SHE wanted to sell it! To keep track of who she had sold to she created a spreadsheet (oh my!!) on a piece of paper showing who had purchased, had they paid and had they collected their bulbs? And she had to find a suitable place to keep the money too. Would she mix the money she collected with the change that she had available if someone needed it? So many things to think about! And with one lovely teacher still to pay, will this also turn into a lesson on debt collection? Time will tell!
And I’ve decided that for myself as a parent I need to play to my own strengths. I go to all of her hockey games but confess that after four seasons I barely know the rules. I’m always the one who is whooping with excitement at a shot well played, as the rest of the crowd groans because it was an own goal. Oops. I’ll ALWAYS encourage my daughter but I just don’t understand the rules of sport. But, I have a degree in psychology and in management, I’ve worked in sales most of my career (when I had one), worked as an in house trainer and I love talking to people about how to save and invest. And this fun project with my daughter let me use all of these skills to help her. Along the way I was very aware not to be pushing my own interests onto her, I really wanted her to drive this project or there was no point to doing it, so I kept stepping back and observing her in action.
And she did drive it, she was so into it. With a bit of help and encouragement from me she learned some new skills and brushed up on some of the ones she is developing:
- Common sense
- Planning and executing a whole project
- Confidence to approach others and ask for something
- Sewing skills. Ironing skills!
- Design skills
- Generosity, saving and spending. In that order.
- And I think most of all she really enjoyed doing something with me, her Mum
So, until such time as teaching kids about money enters the school curriculum I think I’m actually doing a pretty fair job of teaching her myself. I received another email today telling me there is a big bulb discount sale on. I deleted it before she could see it. Every day is a learning day, but sometimes Mum’s just need a break too.
Happy Mother's Day to all of the Mum’s out there!