I recall from my life as a young teen that, after spending most of my years fully ignorant of the money our family had or frankly worrying about it at all, my mother made it clear to me and my siblings that we would learn where our money was coming from, how little we had and how we would manage with our limited resources. After the death of my father, my mother was left to raise four children on a pittance – literally. She worked, we received some aid from Social Security survivor’s benefits, and generous friends and family helped us too. I recall her always telling us that we’d have three things even if we were poor as dirt – good teeth, healthy food, and plenty of soap to keep clean – seriously, that’s what she said.
I recall as if it were yesterday my mother sitting me down at the end of our living room couch and showing me her paycheck, then writing down on the back of an envelope in which a bill had arrived exactly what she needed to dole out with that week’s paycheck. As time went on, in addition to showing me how she wisely made it all work, she taught me to write out the checks for various bills and to see how taking those amounts out of the check register list diminished the dollars until the next money came in. Granted, it was a stark lesson at such a young age, but looking back, it’s clear how invaluable those lessons were as I faced my own money challenges and decisions throughout my lifetime.
Over the past few generations, and especially through the very good years before the 2008 financial crisis, most parents have chosen not to talk to their children about money, much less lay out details of what bills and expenses come out of a paycheck or how much debt is held. Perhaps parents have been protective and wanting to assure their children did not have to worry about money. A prevailing belief through the years has been that children have no business knowing what’s in a parent’s paycheck, and less business deciding how money is expended.
So what’s the right approach for you in talking to your children about money? Here are a few ideas and options to consider in order to, at the very least, introduce the concept that – yes – life does cost money and it’s something that kids need at some point to hear about and get their own heads around.
– Talk with your kids about the concept of household (and life) needs and wants
– Talk with your kids about how important it is to understand what values mom and dad and the family holds and why that matters in terms of getting along day to day around money and reaching some of everyone’s dreams and goals
– Talk with your kids about the old saying, “a penny saved is a penny earned”, and then help them save those pennies in a jar on the kitchen counter
– Talk with your kids about how much it costs to feed them every week, and show them how to clip coupons and find app specials to cut that cost down
– If you are really brave, talk to kids about how to write a check, keep a check register, and all those old fashioned and out-of-date processes around money – they will still, at some point, need this skill set and to understand banking concepts
– Talk with your kids about one specific payday and how much money has to come out of it and for what expenses
– Talk with your kids about when they might themselves start to earn some money by babysitting, or chores for neighbors or at home and then explain to them the practice of saving some, giving some and spending some (and by the way, try to demonstrate that same practice for them in your own money life)
– Talk with your kids about using credit wisely and help them understand that the plastic card you swipe generates a bill that is due next month and the month after that and again the month after that if it isn’t always paid in full.
All of this said, there are many great web resources available now to help kids learn about money and all that goes with making, having and using it. Check out the following as a few examples:
I believe that the sooner children are exposed to money and the wise use of money by their most trusted teacher, their parent, the sooner our world will benefit from their financial wisdom and leadership. Mom, dad, its time to have “the talk”!