money & Banking

Danielle McCarthy

The Barefoot Investor Scott Pape's 3-minute money hack

The Barefoot Investor Scott Pape's 3-minute money hack

Barefoot Investor Scott Pape is on a mission to create a generation of kids who know how to handle their money and make smart financial decisions.

“There’s a lot of people out there who are highly-educated but they are still stupid with money,” says Pape, who has thousands of people following his advice after becoming a financial phenomenon.

And according to Pape, learning how to deal with cash starts at a young age and in the home – with basic rules a lot of fun.

In his new book, The Barefoot Investor for Families: The Only kids’ Money Guide You’ll Ever Need, the farmer and stockbroker writes about a simple approach that every Australian family should follow.

His game plan includes three things: Three jam jars, three jobs and three minutes.

He says that’s all it takes for kids to become successful money managers.

The jars are responsible for separating money into three categories: Splurge, smile and give.

“Three jam jars, three jobs that can be done on a Sunday afternoon and three minutes for the parents to check it all off,” Pape said.

How money jars really work

Mother-of-three Teira Jansen says she taught her children from a young age that “money doesn’t grow on trees".

Mrs Jansen’s children each have a spend, save and give jar, and they must do small tasks to earn money.

“We are fortunate in our situation that we have a reasonable amount of money and I don’t want my children to take advantage of that,” Mrs Jansen, of Forestville in NSW, said.

“If they want to earn money, they need to do jobs and work for it.”

Jobs include emptying out the dishwasher and taking out the rubbish.

Each time Chloe, 3, Alana, 6, or Lachlan, 8, completes a job they earn one marble – this is converted into 10 cents at the end of the week.

“We also give them interest on their save jar, so they get rewarded for that,” said Mrs Jansen.

“It’s simple, and it does take a bit of discipline but it’s important to talk about money.”

And Mrs Jansen isn’t the only parent finding the hack successful as mother-of-two Niamh Gantley says the activity has helped her sons learn about money.

Drew, 7, and Sean, 4, have three jam jars each – a spend, save and give jar – and each time the boys complete a task they are then rewarded with coins to add to their relevant jars.

“They do jobs like emptying the dishwasher, feeding the dogs and simple things,” she said.

“They might only get 15 cents – five cents for each job – and they drop it into each of the jars.”

Mrs Gantley believes it’s important to teach children to be financially smart from a young age.

“They have a comprehension that they have to do something to earn money,” she said.

“They know they have to work even at age four to earn money.”

Mrs Gantley and her husband Andrew Inglis have both picked up tips and tricks after reading the Barefoot Investor's book, saying it has helped them become better money managers.

Will you be trying out the 3-minute money hack with your grandchildren? Let us know in the comments below.