a dollar Tonight when I retrieved Sister Save-Alot from a friend’s house, I was yet again hit by a facet associated with our experiment that took me to one of those light-bulb capped “ahh-ha” moments.

Sister Save-Alot had been sharing an earful about our crazy antics (from the money jar, to the dinners to our new and exciting “Bored Chores”) with the family.  The mom, a sweet friend of mine and fellow MOAT, encouraged my kid to tell it all.  The dad happened to be on hand, taking it all in.

As I stood in their foyer, waiting for Sister Save-Alot to come down, he commented on the brilliance behind the $30 dollar jar idea.  As usual with most of the MOAT strategies, I informed him the idea was not mine, but a friend’s (this one in particular, my friend Lauren).  Surprisingly, it wasn’t the compensation that jazzed him, but the way it played out.  He thought we had planned the strategy.  (Isn’t it nice he would assume something so cerebral and premeditated.  Doesn’t he know we’re winging it … flying by the seat of our pants??!! — at least I am!)

He was impressed by the use of a stock market psychology known in the business world as Behavioral Finance.  A simple definition is provided by Wikipedia (where was Wikipedia in our school days?!):

“A field of finance that proposes psychology-based theories to explain stock market anomalies. Within behavioral finance, it is assumed that the information structure and the characteristics of market participants systematically influence individuals’ investment decisions as well as market outcomes.”

So?  What does this have to do with the money jar?  It’s all about the emotion associated with losing a dollar vs. gaining a dollar being a motivating factor.   Boy have I seen this played out with my kids!

When our experiment started, I just liked the idea of putting a wad of 30 $1 bills in their jars at the beginning of the month.  It seemed streamlined and easy.  Basically, I wouldn’t have to remember to give them money.  I could simply take a bill out of the jar when a chore was overlooked.  Allowance (something that never really worked in our house because I consistently forgot to give it to them) could be a thing of the past.  

For those who have been walking the MOAT road since March, you might remember that I gave the kids an option.  They could either operate from having the bills in their jars and dealing with docking …. or I was happy to let them start each month with an empty jar that could be “filled” as chores were accomplished.  With either option, they’re not allowed to spend the cash until the month has concluded.  My motive was to steer clear of the appearance of a consequence and operate from a reward system if that would be better.

They all chose the dollar docking approach …. except for one.  You guessed it.  Teen Take-Out preferred the dollar put in instead of taken out of the jar.  

Only one of the kids has been a complete Lame-O in our bed making/chore efforts (well, maybe 2 if you count me :)… TTO!!

It’s just like the meal thing where I let them pay for dinner if they didn’t want make it. (I spotted $10 to cover what would be spent for a home-made meal.)  TTO was the only one who opted to buy.  A less than positive experience (see last part of May 6th’s Home Sweet Home).  Good intentions have paved the road to my offering what I hoped to be decision/self-esteem-building options.  Just the opposite resulted.   

How interesting to discover from this successful business man that there is actually a huge motivating factor hiding in the $30 jar.  The motivation associated with potentially losing a dollar is MUCH greater than the incentive to gain a dollar.  Who knew??!!  (I think I must have been absent, or possibly asleep, when this theory was discussed in Business School.  I often wonder these days how I ever made it through school!) 

 TTO’s jar now has “off-limits” cash beaconing his attention.  Poor kid.  Not only am I proving things like Behavioral Finance theories, I’m also solidifying the stereotypical 1st born idiosyncrasies.

Thanks for walking the road with me.  
:) Kay

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