Family finances are a sensitive topic. Our children cannot always have what they want and providing what they need can be a struggle.
It is hard for children to understand why they cannot have the things they see on commercials or in the homes of friends and family. It is difficult for parents to admit that they cannot provide all that they wish they could.
Adults become anxious and embarrassed. Children get frustrated and angry. All of this angst gets in the way of honest and open communication.
Recently, I chaperoned a group of 8th and 9th graders on a trip to a supermarket. Their task was to purchase nutritious food for only $ 39.50 – the maximum weekly per person benefit in a family of 4 who receive funds from the Supplemental Nutrition Assistance Program.
It was interesting listening to them talk to each other as they tried to stretch the money. They were surprised at the cost of nutritional food. They realized that people who struggle to pay for food must have to stretch it by purchasing less nutritional items. They were upset at the notion of how often children their age must be hungry. I was amazed at their lack of knowledge about prices and the value of each & every dollar.
In a world where prices continue to go up but salaries do not and more emphasis is placed on owning expensive things than in generations past, it is imperative that we help our children to learn how to budget. Sometimes life may go smoothly but other times, they will struggle. Children have an amazing capacity to understand when we explain to them and include them in our processes. Make finances and financial decisions a family discussion.
Here are some ways to get started:
- Take young children to the supermarket. Shopping is faster when they are not with you but they don’t learn anything. It is important for young children to begin to be part of the family expense process by seeing that their food is paid for with your money. Give your children the cash to hand to the cashier or show them how to pay by swiping your card. Explain that you cannot take the food home if you cannot pay so paying is an important job. It is so cute and funny when children ask why we don’t just go to the supermarket to get some money. They see money being handed to us but don’t understand that we’ve given money to get that change.
- As your children get older, find a way for them to be part of your bill paying process. Do your children know how much you pay for rent or your mortgage? Do they realize that every time they turn on a light and forget to turn it off, it costs you money? Do they know that the water that flows so easily from the sink or shower isn’t free? From the time my children could read numbers, they were a part of my checkbook balancing process. They would read numbers to me so I could check them off. When I started to enter my checkbook into computer programs, they helped me by reading the entries from my handwritten ledger. More than once, they said, “Wow, that’s a lot of money” when reading the bills to me.
- Give children of all ages financial choices so they can start to understand the decision making process. Financial decisions are math word problems come to life. Young children can be given the choice of purchasing two different foods or two inexpensive toys. They can be told and come to understand that they have enough money to pick only one. Making smart decisions as they get older and participating in family decisions begins with the simplest “do you want this one or that one?” questions.
- Bring them to the table when financial issues arise. It is far less scary and less frustrating to be told what is happening than to be impacted by what seem like random decisions made by stressed out people. Make them an important part of your family’s financial team. Tell them that sometimes life is harder than other times but you will work together to make the best of it.
- Encourage them to earn and to budget their own money from a young age. Every household should have both expectations and ways to earn. In my home, good grades are an expectation. I will not pay my children for getting good grades. They can, however, earn by doing things that are above and beyond our expectations. I will and have paid them for chores like cleaning. If money is scarce, they can earn other privileges – trips to the park and time playing a favorite game with parents are free. If your children earn money, they should have to divide it into amounts for purchasing and saving. It is good for them to save for something they want without our help.
Every situation, including financial challenges, provides us with an opportunity to open the doors of communication and guide children through important lessons. When they see us struggle but survive and solve complex problems by making difficult decisions, they will have confidence in their capacity to do the same. Parents need to help their children to separate facts from emotions. Work with your children to take a logical and factual approach to understanding money.
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