Parents, do you discuss finances with your children? It’s normal to assume that by withholding information from them you will protect them, but kids can always tell when their parents are upset or stressed. They more they know, the more secure they will feel. Having open dialogues about household finances can strengthen your relationship and help your children become money smart.
By discussing the household income and expenses with your children they’ll quickly learn the difference between wants and needs. When you explain the challenge of paying for unexpected emergencies, they’ll begin to understand the importance of having an emergency fund. With the holidays approaching, wish lists are being created. Children who are aware of the family finances can manage their expectations.
Older children typically think they must have the latest Nike Airforce 1s and most recently released iPhone. They ask for things they do not need because they spend hours a day on digital devices exposed to advertisements and influencer posts about cool clothing and products. Instead of getting irritated by their requests and simply saying no, explain why expensive non-essentials aren’t in the spending plan.
When children are young enough to believe in Santa, they’re not old enough for deep conversations about income vs debt. Yet, they are very capable of learning to compare prices when at the grocery store. You can also teach them about saving money by getting them a piggy bank. Let them know they can earn dollars for their bank by picking up their room when told and helping you in the kitchen when asked.