I was in the store the other day and ahead of me in line was a little girl with her mom. The girl was throwing a tantrum about not getting a candy bar. Talk about annoying. After about 2 minutes of crying, the mom gave in and put the candy bar on the checkout belt.
Then, to top it off, the mom’s credit card was declined at the register. As I waited patiently a few spots behind her, she fumbled through her purse looking for some cash. She didn’t have enough for everything – so instead of putting back the candy bar, she puts back bananas and some soup cans!
While that moment could have served as an excellent teachable moment for that small child, it also made me realize that I need to make sure I teach my future children financial responsibility, and part of it is role modeling myself. I found this list of 12 Things I Want My Kids to Know About Money, which is a good start, but here are some simpler thoughts from me.
1. Money has to be Earned
The first thing that I want to make sure is engrained in my children’s minds is the fact that money has to be earned. As in my recent shopping experience, that child has no sense of money, and the mom just made the problem worse. She essentially rewarded the child (with money she didn’t even have) for throwing a tantrum.
I plan on giving my children a commission for doing chores, and teaching them that they have to earn the money they want to spend on things. Frankly, this was one of the greatest things that my mom taught me. To this day I have no problem with work ethic and am willing to do whatever is necessary to make sure the bills are paid each month.
2. You Can’t Always Afford Everything You Want
I’m waiting for the day when my child wants to buy some toy that they didn’t save up for. I think it will be a great lesson to highlight that you can’t always afford everything you want. This lesson seems to be lost on so many adults these days, and it’s one I didn’t grasp until I had major financial struggles of my own.
While I understand that teaching your children this lesson will be difficult (possibly painful), it’s absolutely necessary. It’s so rare to see parents that are willing to tell their kids, “NO!”. It’s no wonder that kids these days think everybody should be handed to them.
3. Spend Less Than You Make
I also want to make sure that my children always spend less than they make. I haven’t fully decided on how to do it yet, but it will probably involve making them open a savings account at the local bank, and going down to deposit some of their commission there every month. I think that both the aspect of saving, and going to the bank monthly, will make it memorable and build a lesson around it.
4. Be Prepared
Finally, I want to make sure that my children are prepared. Like I mentioned saving each month, I want to make sure that they know the importance of being prepared for emergencies of all kinds and other things that may come up. I saw a news clip the other day about a house fire, where the children knew what to do because their dad had taught them what to do in emergencies. The same applies to all types of emergencies – including financial.
The sad truth is that most parents avoid financial conversations with their children. The reasons for this are infinite but it mostly revolves around two things: (1) the parents don’t know much about money themselves and (2) the topic is typically filled with stress and parental fights. So bringing it up around the children is often forbidden.
While it’s great to find ways to TEACH your children how to handle finances, it’s important to remember that they’re always watching what you do. Regardless of what you say, it’s likely they’ll follow in your footsteps.
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