The Tooth Fairy: An Economic Analysis

tooth-fairy-money-ftr

What’s a tooth worth? I’m about to set the precedent, so I’ve got to get it right.

My five-year-old son has loose teeth. Three of them.

One may come out as soon as today.

He’s pretty excited about it. Made me call mom this morning to tell her.

I quickly realized: Oh, shit. I’m the Tooth Fairy now!

I almost never have cash laying around because I don’t listen to my father.

So, I need to make sure I have money on hand for situations such as this moving forward.

But, how much to give?!

A great question, it turns out. I started thinking about my childhood. Growing up with next to nothing.

How much did I get?

As memory serves, $1-$2 per tooth. I might have even approached little-kid baller status with a $3 molar a time or two.

That was 25-30 years ago. So, my initial reaction was to give $5 per tooth. Which is almost enough to go buy something cool when you’re a little kid.

A couple of my co-workers thought I might be overdoing it.

And while I value their opinions, I tend to do what I want. And what I want is whatever the best-possible thing is. And what’s the best-possible thing?

Let’s discuss with an economic review.

Make the Money. Don’t Let the Money Make You.

I’m pretty sure I lost my first tooth in 1984.

The equivalent buying power of $1 in 1984 is $2.25 in 2013 due to inflation. You can check my math here.

Which means me getting $2 or so in the 1980s is not far off from $5 in today’s dollars ($4.51, to be exact) if we want to maintain Tooth Fairy equity three decades later. And fairness totally matters to me.

It pisses me off when people who stay at the same job for several years can’t even keep up with inflation with their annual “cost-of-living” wage increases.

It pisses me off when I see colleges and universities raising tuition 6 percent or whatever the maximum cap is every year and saddling generations of young professionals with enormous debts that take more than a decade sometimes to pay off—even with high-paying jobs in the legal and medical sectors.

My little man isn’t savvy enough to know better. He may be equally happy with $1 as he would with $5. I don’t anticipate him getting online and researching today’s going rate for lost teeth.

But the Tooth Fairy can’t be reckless. Not on the cheap side. And not on the excessive side. Certainly not the first time.

The Santa Parallel

This is something my ex-wife and I used to disagree about. Very respectfully. No fighting. But we’re both products of our respective upbringings.

At Christmas throughout our childhoods, the perceived value of the gifts under the tree were not consistent with one another.

At my house, Santa Claus brought me most of my best, high-value items. Almost all of my favorite gifts growing up were from Santa. My Nintendo Entertainment System Action Set in 1987, being my all-time favorite gift. There were a thousand other things. And I always did everything twice, because I would have a “Christmas morning” with both my mom and stepdad, and then again with dad and stepmom a day or two later.

I always got a lot of awesome stuff from both Santa and my parents. But the real standout stuff came from Santa.

At my ex-wife’s house, Santa would only bring four or five gifts. Not anything shitty. But still lower-value items. Huge gifts? Like video game systems, or family four-wheelers or whatever, were given by the parents.

The thinking is that you don’t want your kid running off to school talking about what Santa brought them and mentioning big-ticket items, or to have another kid run home and ask mom and dad why she only got a board game and a crappy book with a public library sticker still stuck to the inside back cover while her friend got a new pony.

That makes sense to me. I grew up with a higher-percentage of wealthy friends maybe than the average kid due to attending a small Catholic school. However, I was never jealous of my friends. I don’t really get jealous of people having “things.” Never have. And also, I had such a magical time at Christmas every year—TWICE—that I just didn’t waste any energy wondering why someone else might have got something that I didn’t. My brain didn’t work that way.

But still, I don’t want to make other children feel bad, or put unneeded pressure on other parents due to the stories our children might swap at school. I’ll be sensitive about that at Christmas (though an abundance of cash will most certainly not be a problem this year!) as I am now with this Tooth Fairy situation.

C.R.E.A.M. Get the money. Dolla, dolla bills, ya’ll.

One dollar is not enough. I’m sorry. It’s not.

But $10-$20? That seems outrageous. That’s not happening either.

I think I’ve convinced myself that $5 is the right monetary ceiling here.

And I think I’ve convinced myself that lessons in money management (which I could certainly use a refresher on as its perhaps my greatest personal weakness) might be in order for my little man.

I am not financially disciplined. I want to be. But I’m not. I might even be a little reckless. Not majorly. But a little bit.

I think if you had a heart-to-heart with my ex-wife, she would tell you that this is in her top three of Matt’s Most-Undesirable Traits.

And I’d be quick to agree with her.

On a human-relations level, I very much want my son to be like me. I think I know how to treat others, and I think his observations of how I treat others over time will give him a blueprint for appropriate manners and decorum, depending on the audience. I hope so, anyway.

But on the money-management level? I have some very serious changes to make in my life before I can be a credible teacher.

But that doesn’t mean I shouldn’t try.

Right?

Right.

So, maybe the Tooth Fairy gives $5, with the caveat being my son has to put $2 of it into his savings account. Otherwise, he only gets $3 next time.

I’m going to consult the Tooth Fairy’s ex-spouse to see if she co-signs on this strategy. Because we must still be a team. Even on matters related to dental folklore.

My guess is she’ll think this is a decent plan.

Which means I have two new chores for today:

  1. Build a Tooth Fairy emergency fund.
  2. Write a note to my son from the magical little wealthy tooth collector.

I’ve certainly had worse jobs to do.

Regards,

The Tooth Fairy

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17 thoughts on “The Tooth Fairy: An Economic Analysis

  1. David says:

    The idea of putting money into savings makes sense to an adult, but would it ever make sense to a kid? I remember my parents insisting I have a savings account and showing me the interest accruing every few months/years. 5 cents this year? So what?!?! I’d rather have the WHATEVER now than wait for a bazillion years to get two WHATEVERS.

    Is the lesson postponing gratification instead of just saving? By setting aside a little at a time, think of the big stuff that the future can bring.

    $5. That gets my vote.

    Like

    • Matt says:

      So, you’re in favor of saving, but not necessarily this idea of saving for college or retirement?

      Perhaps teaching the lesson that to acquire expensive things, we must exercise patience and discipline and long-term thinking?

      Meaning, you think asking him to save $2 is OK. You just want him to have something cool to save it for?

      Like

      • David says:

        I’m absolutely in favor of college/retirement saving, but I remember those things not making sense at that age. The saving makes a LOT of sense, but the carrot has to be age-appropriate. I don’ t know what that is, but I know that, even as 25, retirement seemed like an unreal thing to save for. As he ages, the carrot can age, too, until eventually it’s college or retirement and he’s got the habit of dividing money into now and later.

        By the way, it’s spectacular that you’re considering this.

        Like

        • Matt says:

          These are wise, sensible observations.

          I really appreciate it. I tend to agree with you completely.

          If it wasn’t for auto-deductions on my retirement plan,Future Me would be in trouble. So, even now, knowing that the future WILL catch up to me one way or another, I have trouble willfully socking money away.

          I just want to impart lessons. I realize there’s almost no chance he’ll care.

          Thanks for weighing in on this. I really appreciate it.

          Like

  2. At risk of confusing you with another whole philosophy, the tooth fairy that visited my kids gave books, not cash. I suppose that says something about what was considered valuable in our household (the importance of books was one thing my ex and I always agreed on). Plus we were always buying the kids books and stashing them away for the next gift occasion, so if we got caught short with an unexpected tooth, the odds that we would have a book on hand were always greater than the odds that one of us would have the right configuration of spare change :)

    Like

    • Matt says:

      That does not seem foolish.

      However, I’d be lying to you if I thought I had the discipline to pull that off.

      I can definitely acquire a little money more easily than I can a tooth-loss-worthy book!

      I like this, though. So many wonderful parents out there.

      Thank you for this note.

      Like

      • Before you go classifying me as a “wonderful parent” I should really disclose the occasions (yes, there were more than one) when the Tooth Fairy FORGOT TO COME. (In the pantheon of parent-nightmares that is right up there with leaving the baby at the mall). With child #1 there was much weeping, and the tooth fairy showed up the next day (with a carefully penned note of abject apology. I fared better with child #2 –I managed to slide the item under her pillow while she was eating breakfast and convince here that the Fairy must have been just running a bit late that day. The things we do…

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  3. Lk says:

    Wow 5 bucks- I think some of my teeth are feeling loose! Ha! In all seriousness sounds like a good plan with implementing a savings lesson, very smart.

    Like

  4. knace says:

    Back in ’76 when I lost my first tooth, I’m pretty sure I got a dime. Even adjusting for inflation, I think I was gypped! Erik had a pretty erratic tooth fairy. The worth of his teeth varied wildly depending on whatever cash I had on hand. I think it taught him a valuable lesson about volatile economies. =D
    Somehow, no thanks to me, he seems to have grown up into a kind and thoughtful young man.
    $5 sounds about right to me.
    I just asked my husband if, gypped or not, I had taken that little dime back in 1976, and invested it in an average performing mutual fund, how much would I have today? “Probably hundreds of dollars, right?” “About 40 cents”, was his answer. “Really? That’s all? Are you sure??” “Yup.”
    I can’t stop giggling.

    Like

    • Matt says:

      300 percent R.O.I. over 37 years is pretty good!

      I figure I’ll be working ’til damn near 70. If I’m lucky enough to still be alive, I hope my accounts perform that well!

      I can’t wait to just drink excessively every day and rub Ben Gay all over myself.

      Ewwwwww.

      Like

  5. jessiesgirl says:

    Well, I must be REALLY OLD then (or we were poorer than I realized) because I didn’t even get a dollar per tooth. But the Tooth Fairy did leave me a big ol’ half dollar coin for each tooth…the Kennedy half-dollar coins that they don’t produce anymore for general circulation. And looking back, that was a pretty cool and unique thing for my parents to do. In fact, I think I still have a few stashed away along with my collection of $2 bills, Susan B. Anthony dollars, and other obsolete currency.

    One time, my sister forgot to put money under my niece’s pillow for a tooth. So she used the “tooth fairy is running late” excuse and went upstairs and put it under her pillow while both of her kids were eating breakfast. Afterwards, they went into my nephew’s room (across the hall from my niece’s room) to change his diaper. My niece wondered aloud whether or not the tooth fairy had come yet, and without skipping a beat, my nephew pipes up with, “I think she just left. I saw bright sparkly purple lights in your bedroom.” My niece rushed to her bed and squealed with delight upon finding her Tooth Fairy money. To this day, my sister laughs and wonders if he knew she needed back up for her story, if he actually did see the Tooth Fairy, or if he just had a very vivid imagination. :-)

    As for your son, the amount is up to you. But I do support the idea of having him put some away in a piggy bank for a rainy day. I wonder if there is a modern-day equivalent of the half-dollar coin? Something special and unique, perhaps in addition to the $5? Just a thought.

    Like

    • Matt says:

      They have gold $1 coins. It’s what one of my co-workers leaves for his kids. Something unique.

      I can get behind that.

      But I’m not ambitious enough to round up a bunch of those!

      I liked your Tooth Fairy story. Bright sparkly purple lights. If you drink enough tequila, you can see the Tooth Fairy every night!

      Like

  6. I think your best bet would be to show how magnanimous you are by allowing your ex-wife much more time than usual with your son for the next few weeks. Say you have a business trip or a hot assignation in Mexico or something. Then let your ex deal with paying for those three loose teeth. Ooh, I am evil, aren’t I? :)

    Like

  7. Aspen'sProudMama says:

    Have to add, you list your first tooth the year I graduated H.S. Ugggh, I feel old. Those same things piss me off too. When the cost of living increase doesn’t come anywhere near how much it really needs to be, it’s a joke. The college crap sucks balls, bad. Also, when you’ve worked somewhere for quite awhile and the new people coming in staying out much higher than you’re making. Not saying they shouldn’t get the extra, however, they should also increase the salaries of the long term employees so they actually make more than some newb.

    $5 seems like a good amount to me, too. That’s about what I gave my daughter.

    Seeing the stories of forgotten or late tooth fairies, makes me think back to a year the easter bunny was really busy and had to come later in the day. I felt like the worst parent, it was plumb awful!

    Like

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