Learning About Money is a Roller Coaster Ride

My 8 yo daughter can’t understand the difference between a couple of hundreds and say, a lakh, or a crore. The only context in which she cares about these numbers to even try and compare them is, of course, money.

Then again, this inability to visualize the magnitude of difference between large numbers is a human-wide problem. Adults can’t do it either. Hence the endless analogies, like mapping the life of the planet (4.5 billion years) onto a 24 hour window, and then trying to impress you by pointing out that “modern humans have been around since 11:59:59pm—1 second”! So perhaps it’s too much to expect from kids.

But we’re talking of kids here: Anything you think is easy, they absolutely won’t get. And they’ll have their enlightenment on whatever you have no hopes about.

Recently, I told her that one of my friend’s kid was supposed to go on a school trip to the US. But given how much it cost, most parents dropped out. And so, I told her, the trip was cancelled. “How much did it cost?”, she asked. “2 lakhs”, I replied. Her face had an expression of “Yeah, that’s a lot”. I was pleasantly surprised: is she finally beginning to get a feel of what kind of money is “a lot”?

I shouldn’t have rejoiced so soon. When she takes money once in a while to buy stuff at her school canteen, I prefer giving her the right amount to carry. Less risk of her not collecting change, less to lose if she loses the money altogether. She, on the other hand, will insist I give her more money than needed. The more, the better, she’ll argue. “Why?”, I countered, “You’ll spend the same amount either way”. She gave me a withering “You know nothing” look that would have made Ygritte from Game of Thrones proud. Then, she patiently explained:

• If she gives more than needed, the shopkeeper would return money to her;
• But if she gives the right amount, he won’t return anything;
• Even you can appreciate that getting something is better than getting nothing;
• And as icing on the cake, she threw in her marketing wisdom: If you spend money, and get money back, it’s called “cashback”.

I was blown away by the “logic” of all this!

Thus continues our roller coaster ride on trying to teach the kid about money. And like any roller coaster ride, it’s scary at times and fun at others…