Relative Value and its Importance

Relative value is the cornerstone of teaching responsible management, and the basis for making intelligent decisions about money.

Relative value means what one thing costs in relation to what you personally have to do to pay for it. Relative value is the "real" cost of something, and it can make your and child's purchasing decisions much clearer.

For example, to take your family of four on vacation for a week to DisneyWorld, it may cost you a total of $6,000. Now think of the cost of that vacation in a different way. Did you have to work one week to earn the money, or eight weeks? You may have spent $6,000 in money, but in terms of relative value, that vacation cust you X number of weeks of sweat.

Also, when thinking of the cost of something. You may think it is only so many hours or days of work, but if you get too many of those things, they may end up being most or all of your pay.