YEDID is working to prevent debts and bad money habits in the future by teaching the younger generation today. 11-year-old Shai from Pardes Katz: "Now I know how to spend my money wisely."
Twelve-year-old Daniel approached Iris, the group moderator. "I want three million Shekels credit to buy a hotel in Netanya," he states without batting an eyelid. His request was approved and two hours later he was the happiest boy on earth. At the end of a number of business deals that would not put the most seasoned businessman to shame, he promoted his hotel deal and pocketed no less than 6.3 million shekel. All on paper of course.
Daniel is one of 26 sixth-grade students at the Pardes Katz Kommemiyut School who are participating in "The Power of Money", a unique series of workshops in money management.
Standing behind the venture are YEDID, a non-profit organization offering social, economic and legal assistance to the needy, and ECI who provided professional staff and funding. According to YEDID Deputy Director Ran Melamed, the idea developed as a result of the large number of young people who approached the organization for help over the past year. Young people in trouble due to huge debts incurred to cell phone companies, clothing stores and more. "Many of them simply lack the tools, experience and knowledge to manage a budget. It can put young people, particularly young girls, in huge deficit."
And so YEDID recruited ECI Telecom to the cause and together they are teaching the next generation the correct approach to money management. "During the course, the children learn about expenses, income, credit, the smart way to make purchases with the money they have, and how we are influenced by advertising," says Iris Bayer the Director of YEDID's Citizen Rights Center in Tel Aviv who facilitated the course along with Einat Rothfeld, manager of ECI's department for social responsibility.
During the first few sessions, the children learned about income and expenses, enticing advertising and budgeting. Once they were ready, they went out shopping. Each child received ten "shekels" to spend at a "mall" set up on the school grounds. "The kids were supposed to go from store to store, checking out all sorts of deals and discounts on offer, with the aim of making smart purchases with their money. They successfully rose to the task and a few even formed partnerships to make even better purchases", related Bayer.
At yesterday morning's session, the students learned about credit. Once Iris and the other staff members had explained the term to the students they were thrown into the world of big-time business and serious sums of money. Monopoly and other money games were spread around the room and for the next two hours the children acted as real business people. Daniel was the first businessman to ask for credit—to buy a hotel.
After Daniel and Iris discussed the wisdom of the purchase, the credit was approved. For the next two hours he ran around buying and selling buildings and streets. Two hours later he came back to Iris with a 3.3 million shekel profit.
Twelve-year-old Erica was more conservative. She requested 1,830 shekels credit which she invested in public companies including a bus and a train company. Accordingly, her profit was also modest as she ended the day with 3,600 shekels. Their class members also ran around buying and selling, consulting with professionals—and most importantly—enjoying themselves.
"Now I know what credit is. It's money that's mine but not really mine. And now I know how to spend my money wisely", 11-year-old Shai, summed up the experience.
And Iris, the moderator also concluded, "the goal was to give them the tools for correct money management and withstanding temptations, advertising and peer pressure. I'm confident that they will now be better consumers."
Ten tips from YEDID in how to teach your children not to waste their money!
1. Work out income and expenses and aim to balance them.
2. Ideally, income will be more than expenses.
3. Use good judgment so as not to be lured by advertising.
4. Buy according to you needs, not because of friends.
5. Peer pressure leads to unnecessary spending.
6. If you have some spare money—thing about saving it.
7. One shekel at a time, you can eventually save a considerable sum of money.
8. Being "in" doesn't necessarily mean being a big spender.
9. Money is limited – just like time.
10. Take charge of your money: don't let it take charge of you