There are many lessons and behaviors that we learn from our parents.
And whether good or bad, we tend to parent our kids in very similar ways to how we were raised as children.
Of course, we want to give our children the best start possible, but there’s one topic you may not be focusing on that can make a big impact on their future.
While it’s unfortunate, money drives pretty much everything in life.
Adults who are financially strapped and always struggling are more overwhelmed and stressed-out, and our kids inevitably pick up on that.
No matter the financial circumstances of your childhood, you probably remember at least some discussions – or arguments – over money and bills.
People are now more dependent on credit cards than at any time in our nation’s history. We are becoming a nation of debt, with few people prepared for emergency expenses.
You don’t have to be a financial wizard to give your child some common-sense tips about money – and it just may make a big difference as they grow older.
NBC News recently reported on a survey of U.S. parents, of which a quarter said they were never given any financial guidance from their own parents as they were growing up.
And they’re suffering the consequences of overspending, never-ending credit card debt, and living paycheck to paycheck because of it.
While kids may learn the basics in school, it is very important to learn financial responsibility as it relates to and impacts the family unit.
The most important part of that is not being afraid to talk to your kids about money.
While we don’t need to bring our kids into all the nitty-gritty details – or especially argue about money in front of them – they can benefit from some financial lessons at an early age.
Many parents like to use – and teach – a three-pronged approach: Spending, saving, and giving.
If your child receives an allowance or gets lots of cash for birthdays and celebrations from family members, help them to create a “spreadsheet” budget.
This can be as simple as three columns with pictures for the youngest children.
Then, make the idea concrete by physically putting the money into three envelopes, “piggy” banks, or glass jars so they can actually “deposit” the money and see the results.
Obviously, kids are not going to have the regular bills that adults have to account for in their “spending” category, but they can budget out money for items that you don’t provide them.
Older kids who go out with friends to the movies or teens who need gas money can learn how to estimate their spending for the week.
Most kids want a special (and often costly) item, and it always seems like they can’t wait until their birthday or Christmas!
By allocating a certain portion for savings, they will learn the responsibility – and patience – required in order to budget long-term.
Putting aside money for “giving” has a dual purpose. Kids will learn to deduct that money from their budget, while gaining insight on the circumstances of others through the act of charity.
“Giving” money can be for Jesus, i.e. the collection plate at church, or can be saved up for a special project.
This can be fun if you take your child to purchase supplies for a homeless shelter, make busy boxes for kids in the hospital, or participate in programs that allow families to stuff shoeboxes for children in underdeveloped nations.
And if you do give your child an allowance, make sure they do some sort of “work” to earn it.
This can be chores or giving special help to a family member — anything that teaches them that money is payment for work; not just handed out.
Older kids and teens can benefit from participating in “family meetings” where budgets are discussed or even help Mom and Dad balance the checkbook or work on the family financial spreadsheet.
Financial discussions can be started as soon as you think your child understands the concept of money.
The process can start small, such as playing “grocery store” with your child and their play money and play cash register. As they get older, let them help with your grocery list by comparison shopping at your side and sticking to a budget.
Talk to them about purchases, introduce them to age-appropriate factors of financial planning, – and make it fun!
Do you talk to your kids about money? What are some of your ideas to help them learn to be financially responsible? Leave us your comments.