I’m a big fan of teaching your kids about money topics. It was clear to my wife and I once we started to get our financial act together in our late thirties that as parents we needed to do a better job preparing out three children when it came to financial education.
We involved them in our financial discussion at first so they would understand the changes that would be taking place in our household as we work our way to paying off $109,000 worth of debt.
It was going to take some discipline and all three of them hearing the word “no” a little more frequently than they were use too. After the initial involvement, we began to include them in our regular money discussion, talked with them about money topic they were interested in, and as they got older educated them more on all things personal finance.
We will continue to help teach them as best we can. Having open discussion about money will hopefully foster this in the future as they begin to take on more financial responsibility. We feel like they will be better prepared in their early twenties than we ever were to deal with money.
I have interviewed several personal finance bloggers over the years and have asked them a simple question. What are you teaching (or will you teach) your kids about money? Here are ten of my favorite responses.
Teaching Money Skills to your Kids
JMoney from Budgets are $exy: A) That it’s not about the money itself, but what it can GIVE YOU (going back to living life on your own terms and that ER stuff) and B) that you can have jobs that aren’t “real” like those typical 9-5s we’ve all done in our lives. I had no idea I’d ever become an entrepreneur or work for myself which the blog really opened my eyes on. So, I’m going to start my kids off early with mini-hustles and see what empires they are able to build by the time they’re even in high school. Perhaps I’ll even make them go through a family-based Shark Tank deal to get them prepared for the real world, haha…
Alexander from Cash Flow Diaries: My parents taught me to have a really super high work ethic, be the best I can be at anything, put in 110% and all that mumbo jumbo. That is exactly what I will teach my kids. They will live comfortably, but they will know they need to work to live a good life like that.
Elle from Couple Money: Since our little girl is three, we try to focus on the idea of having choices. When we go grocery shopping, she can pick out one item to buy. Sometimes she wants several things, but we tell her she can only have one. Some days are harder, but she’s starting to understand that we won’t budget and she will pick one item.
Maggie from Northern Expenditure: My kids are still pretty young, but we’re very open about teaching them how things work. They know we choose not to spend money on a lot of things and that we think carefully about things we buy. We are sure to correct them when they say things like “we don’t have enough money for that” by reminding them that we are blessed and lucky to have enough money for a lot of things. We don’t worry about eating, clothing ourselves, or staying warm in the winter.
We just make choices as to where our money goes. We choose the things we think are most important and put our money there. We also don’t give our kids an allowance because we don’t want them to think they deserve money just by being alive. They each have a list of jobs they are expected to do throughout the week without pay as a contribution to the family and the household. On Saturdays, if they want to earn money, we have a sort of job interview/review with them of the week’s work. If they whined and cried about expected jobs or had to be reminded too many times or didn’t do them well, we don’t hire them on Saturdays for other jobs. It’s worked out well in allowing them to figure out for themselves when they are ready to earn money, and this opportunity has allowed them to come up with their own financial goals to work toward (my oldest wants a waterproof camera!).
Physician on FIRE: My boys are five and seven. They have piggy banks, and we often add but rarely take from them. If there’s something they want, and the cost isn’t substantial, we sometimes let them spend some gift money.
I’ve read about other techniques, such as the three-jar method where one jar is for saving, one is for giving, and one for spending. I’m not sure I’m ready to have them spending for the sake of spending when all their needs and most of their wants are already being met by us, and our friends and family.
Unlike many households, we do speak openly about money, including the cost of not only objects, but also experiences and things they don’t see, like electricity, taxes, and Daddy’s nasty gambling habit.*
*I made that last part up. Unless you count Fantasy Football, in which case, the struggle is real.
Bryan from Income Surfer: I’m not teaching him much yet, he’s a toddler. What I want to instill in our son is a solid work ethic (because I am weak in this area), an analytical curiosity, and to respect money but never take a job “for the money”. The biggest might be how to make money work hard for him, so he doesn’t have to work so hard to get fresh capital.
Ruth from Prudence Debt Free: We’re teaching them the basic concepts found in Ramsey’s book. We encourage them to budget and to save and to give. We don’t enable them by bailing them out of financial crunches that they have brought on themselves. (That’s a tough one for me!) Since they are older – one teen and two in their twenties – we have to approach the whole matter of teaching our children with an understanding that they won’t always agree. Still, I’m very encouraged by the changed attitudes towards money that I see in them. There is nothing more satisfying for indebted parents trying to turn things around than to see their children handling their finances wisely.
Tawcan from Tawcan.com: Baby T is about to turn two so it’s still too early to teach him about money. Once he’s a bit older, we plan to teach him about the value of money and how money can work hard for you if you invest it wisely. I plan to slowly get him involved in managing his dividend portfolio that we created for him so he can learn about investing. Other important things that we plan to teach Baby T and any of our future kid(s) is that frugality is the key and money doesn’t mean everything in life. You can be happy and have awesome experiences even without having to spend a penny.
Steven from Even Steve Money: I’m probably going to have my wife teach all the good things that she did with money and I will tell them all the bad things I did. I’m going to keep things as simple as possible and lead by example, explain the benefits of living below your means and how to save money so you have the freedom to choose your life rather than make decisions based on your debt.
Andrew from Living Rich Cheaply: I’ve thought a lot about this but haven’t come up with a concrete plan of action. I still have time as my kids are still young. Teaching them to be financially literate is definitely a priority. I have many co-workers who coddle their adult children and I’m sure they were like that when their kids were younger too.
I don’t think their kids will be able to handle their own finances without their parents. While coming up with a good plan to teach my kids about money is great, I think being a good role model is even more important. I know someone who always has to buy the latest tech gadgets. Then when his teenage daughter asks for the latest iPhone and other things, he tells her that she should be more frugal. It’s difficult for him to teach her frugal values without being a hypocrite.
As you can see there are many different approaches to the simple question what are you teaching your kids about money? So, I’ll ask my readers what are you teaching or have taught your kids about money?