Lessons in Spending: Returns & Refunds
By Julie Frans, Chief Community Officer
Like many parents, my Cents of Responsibility journey is still pretty new. Perhaps the part I appreciate most about this new path is that I recognize a new opportunity for my kids to learn important lessons about using money wisely on a regular basis. I recognize it's because I'm now giving them the tools and freedom to learn through their own everyday experiences. It's been extremely rewarding to learn other parents are finding the same with their children.
Case in point from my house recently ...
For her 5th grade graduation present, Cassidy received a debit card as an added tool in her toolbox of financial literacy training.
She's shown a lot of responsibility with her card, always keeping track of what's on it and what she can budget in her spending. She always knows exactly what is available, and what she needs to earn or add to it to be able to purchase what she wants or needs.
Last week, Cassidy went shopping with her close friend, Harper.
Cassidy spent $32.33 at Francesca’s, a local boutique, which took her down to $.80 left on the debit card.
Next, she went to Urban Outfitters, and realized she really wanted a shirt there instead for $36. Yikes! What's a COR pre-teen shopper to do with only a few dollars of cash left in her wallet, and only 80 cents on her card?!?!? Time to make some decisions and compromises.
So, Cassidy decided to walk back across the mall to Francesca's to return purchase #1 for a refund. (At least… she thought she did!) Unexpectedly, when Cassidy and Harper then went BACK to Urban Outfitters to buy her treasured shirt, Cassidy discovered the money had NOT been returned to her card. She still only had $.80 available. That's when my daughter came to me, not sure what to do. Luckily for Cassidy's fashion desires, I was nearby and able to help. But, that help came with a lot of learning.
One big problem we quickly discovered… Cass had left the return receipt at the store, and she had nothing to prove her purchase. She remembered the cashier had held on to it, and Cass hadn't bothered to ask for it, even though she didn't have the returned item in-hand anymore. No purchase, no receipt, and no proof!
As we discussed ways to solve her problem, Cassidy mentioned Francesca's rewards program. Cassidy had used her phone number when paying, so she asked if they could track the purchase and reissue the refund. Ultimately, they were very sweet and helpful, and had no issue helping my distraught daughter.
As she calmed down, I took the opportunity to remind Cassidy that in many situations, she would not have been able to get the refund issued without a receipt. Large, corporate stores or tiny mom-and-pop stores might not have rewards programs or an ability to reference past checks. She would have been out of luck had this happened at many other places. I'm sure this lesson wouldn't have hit home if we were dealing with my debit card, or my credit card. She was particularly in tune with the lesson because it was her money she was dealing with.
Ultimately, it took two days for the refund to show up on Cassidy’s debit card. She checked diligently each morning and night. Finally, there it was. Again, if it were my card, I'm sure she wouldn't have had the same follow-up.
This shopping experience was a HUGE learning opportunity for Cassidy and Harper. They learned important life lessons early that might save them many headaches in the future when making purchases on credit or debit cards, and making returns.
The lessons learned included:
- Always check that the refund shows up on your account.
- Sometimes it takes a day or two, so don't expect to use your card immediately after a refund gets issued. (And furthermore, don’t expect to use your card to purchase something immediately after a refund since it takes a little time.)
- Always keep your receipt until you are SURE that the money is back in your account. (Even if you no longer have the purchased items.)
- Use rewards programs in stores ... not only for the points, but in case you ever need them to look up a past order. Rewards programs often get you deals, but they also provide a safeguard for you.
Like we always say at COR: Allowance is not free money. Managing money is an important learning tool that kids need to practice in everyday life.
As a parent, a strategic allowance program gave me, and my kids, the opportunity to teach my kids about money in a very real-world way. I'm loving the idea that other COR parents are seeing the same progress. Our kids just don't learn the same way if we teach them through hyperbolic concepts, jargon, and hypotheticals. They need to feel the experience of earning and spending, including sometimes making mistakes.
In this experience, it was important to talk about what to do in the future to prevent this from happening again. Cassidy and Harper are more aware of the debit card process, and will remember the lessons learned at Francesca’s.
If your kids don't have the opportunity to spend their money, practice budgeting, and use financial tools like online accounts and debit cards, how are they supposed to practice?
Starting with a strategic allowance program can set your kids up for a lifetime of financial literacy. Start with a Cents of Responsibility course now, and let’s get the learning party started!
