How Video Games Can Improve Kids’ Financial Skills
Every few days my 8 year old son Neal asks if he can “win something” on Roblox, a popular online video game platform. This is his way of suggesting that I buy him Robux, the platform currency, in exchange for a chore or an additional academic assignment.
While I usually decline these requests, his persistence made me wonder if games teach him any personal finance lessons, such as how to budget for a scarce resource – Robux – and if his practice in this virtual world might help. ‘help navigate the truth. Will he be less likely to waste real money if he has already practiced stretching his Robux budget?
Some experts answer with a categorical âyesâ. Mark Mazzu is a former banker and stockbroker who teaches on the online educational platform Outschool. It uses Minecraft, another popular video game, to help kids learn about the economy. âYou see them trade naturally; they understand that. Negotiating, exchanging, buying, selling is fantastic, âhe says.
But financial literacy experts also claim that whether kids actually learn money lessons from video games depends a lot on how parents talk to them about their online experience. Here are four conversations to have to help your kids who love video games develop real money skills.
How to build a financial safety net
In his online courses, Mazzu raises the question of how to protect his students’ money. âI ask them, ‘What does a bank do?’ and transition to a Minecraft chat. “How do you keep your stuff safe inside Minecraft?” In the game, players use safes, for example, which protect valuables, much like a bank account.
This can lead to a discussion of saving money. Mazzu suggests wording it appropriately: âIf you’re going to get 64 pieces of coal or cobblestones, you don’t want to use everything you find. You want to put it away. Why not put 10% aside in a safe and use the rest? Mazzu said. âIt’s a great way to teach kids how to save,â he adds.
The advantages and challenges of being an entrepreneur
Laura Vanderkam, author of “Off the Clock” and mother of five children under 15, says her children took silver lessons from the game Roblox Theme Park Tycoon, where players build and manage an amusement park . âThere are a lot of corporate award decisions that aren’t the kind of thing kids would get a chance to do in real life, unless you have a serious lemonade stand,â says Vanderkam.
She says parents can take those lessons home by asking their kids about games and drawing parallels to the real world. âPeople are obsessed with the negative aspects of screen time, but there are a lot of interesting lessons to be learned,â says Vanderkam.
The value of money
Susan Beacham, CEO and founder of Money Savvy Generation, a financial education company, warns that video games often emphasize superficial purchases, like virtual decorations or avatar dressing. However, she says they can also provide a way for parents to bring up the uncomfortable topic of money with their children.
Parents can talk about the flaws in games, such as currency that cannot be spent, not invested, given or kept in an interest-bearing account, for example. âIf you want them to learn a lesson, you have to talk to them about it,â she said.
Beacham also suggests that children earn money or use their allowance to buy virtual currency to play. âThe kids will take your money all day. You have to create scarcity and get them to make a choice. When they spend their own money, it’s different, âshe says. Then she suggests following up afterwards and asking if they think the cost was worth it. âNow you teach your child about money and value. “
How to budget and compromise
Jeff Haynes, editor-in-chief of web and video games at Common Sense Media, a nonprofit that promotes safe technology and media for children and families, says the money lessons can begin even before the game is not played. Children should consider how much the games cost and why they prefer one game to another. âWhether you’re asking for a giveaway or saving for a title you want, there’s an allocation of funds and negotiation with your parents,â he says.
Many popular games involve virtual stores, merchants, and a set amount of funds to purchase things like a crown or skin for your avatar. Players need to think about how to earn enough coins to acquire the items they want, says Haynes.
Haynes suggests parents take those budget compromises home by asking questions: “Why is this something you want for this game rather than something else?” How are you going to save money to get it? “
Now when Neal asks me for Robux, I think about how to make sure he really earns that currency. I want him to internalize the idea that Robux, like real money, is a scarce resource and not something to be taken for granted. In addition to making him earn the Robux through chores or extra homework, I ask him to explain to me what he gets out of the purchase and why it is worth it.
For his part, he told me that he thought this strategy was working: âIt teaches me not to use too much Robux, and in Tycoon games, I’ve learned to save for really expensive things.
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Kimberly Palmer writes for NerdWallet. Email: [email protected] Twitter: @kimberlypalmer.
The article How Video Games Can Improve Children’s Financial Skills originally appeared on NerdWallet.