Tooth Fairy Hit By Inflation
Apparently, the price of baby teeth has gone up since I was a kid:
Like Manhattan apartments, the value of baby teeth has been skyrocketing lately.
The tooth fairy is paying an average of $3.70 a tooth — a 23 percent rise since last year, and a 42 percent bump from two years ago, says a study Visa released Friday alongside its Tooth Fairy Personal finance app. That means a full set of 20 baby teeth nets an average of $74.
“I think the Tooth Fairy is suffering from irrational exuberance,” said Jason Alderman, director of global financial education at Visa, referencing comments ex-Federal Reserve Chairman Alan Greenspan made about the dotcom boom and bust.
He has a point. Baby teeth values are way out of whack with inflation, which over the last year has risen at a rate of just 2.0 percent. So what’s the deal?
The hike might be driven by good ol’ fashioned guilt, according to Neale Godfrey, chair of the Children’s Financial Network and author of books such as Money Doesn’t Grow on Trees: A Parent’s Guide to Raising Financially Responsible Children.
“I think the amounts have gone up because we feel guilty about our parenting,” Godfrey told the Chicago Tribune. “We are not spending as much time with our children as we would like, and so we substitute money for time.”
When I was a kid, the going price seemed to be about a dollar, which in my particular case was paid out in the form of an Eisenhower Dollar Coin, which was still in general circulation at the time.
Part of it, I think, is the tyranny of denominations. Parents gave $1 forever. That’s no longer a significant amount of money, even to a small child. The next bill up is a $5. Even if you just go to two $1s, that’s a doubling.
I saw that with the valet parking in the garage next to the Atlantic Council. Pretty much everyone tipped $1 during the course of the 6 years I was there. Owing to inflation, that tip is now worth 89 cents in 2007 dollars. But nobody’s going to give out a buck and a quarter, much less a buck thirteen. Eventually, people will start tipping $2–a whopping one hundred percent increase.
@James Joyner:
Fair point.
Maybe then the $2 bill, which is still in circulation although rarely seen “in the wild,” will finally have a use.
In our house, it’s not so much “inflation” as “interest”. There are occasions where the tooth fairy is just too busy and/or forgetful, and a tooth may stay under the pillow for more than one night … with the usual result being an additional payout to compensate for the delay. 🙂
I’m glad someone thought of the $2 bill. In our house my wife and I would scramble to find a dollar coin, as we felt the tooth fairy deposit should be a little out of the ordinary. Moving to a $2 bill seems natural, although I’ve hear (very anecdotal) stories of cashiers refusing them because they thought they were fake…
@MarkedMan: I’ve hear (very anecdotal) stories of cashiers refusing them because they thought they were fake…
When I was younger, I worked in a grocery store where that happened. The cashier was incredibly confused when I and another customer vouched that it was real. Due to the whole check-for-forgery bit they drill into the cashiers’ heads and the fact that we were close enough to Canada for him to be intimately familiar with what foreign currency should look like, he was understandably suspicious of something he’d never seen before. Before the manager was called in, I offered to trade two singles for the bill. Customer happy, cashier relieved, and I am still the proud owner of that somewhat unique bill. Looks great in my collection!
@MarkedMan:
Woz’s $2 bill sheets.
Geez, don’t let my kids see this. I’m still giving them a buck. I only got a quarter as a kid so I thought I was being reasonable until this story.
Of course, I don’t exactly live in a big city, so maybe the prices are lower around here.