Monday, June 23, 2008

What Do You Tell Your Kids About Money?

We talk to our kids about not smoking, drinking and taking drugs. At least my parents did, and that is one major reason I never tried drugs. I knew their expectations. But, do your children know how you feel about money? What about credit cards? If you think they teach this kind of thing in today’s public schools you are sadly (very sadly) mistaken.

So, when do you start talking to them about it? And what do you say? Well, let’s start with what you should NOT say…

My parents never spoke directly to me about money. However, I did get the, “No, we can’t afford it,” speech more than once. This made me fearful that we were one step away from living on the streets. So, if you haven’t spoken to them specifically about money, watch what you say indirectly. I like my husband’s phrase, “We could buy that, but we choose to spend our money on other things.” That is a MUCH more secure statement.

A lot of what you say will depend on the ages and maturity level of your children. You may have a child who just really doesn’t care and will not sit through a lecture. In this case, just hit them up every once in a while with something like, “Don’t open a credit card, they will steal all of your money.”(Sounds dramatic, but you are trying to spark interest) Maybe eventually one of these statements will be a springboard into a longer discussion on money.

I have recently started talking to my 11 year old about credit cards. I told her that if she can’t afford something with the cash she has that she should not buy the item. We talked about how they work, and how you could end up paying three times the original price of an item if you keep a balance on the card and have a high interest rate. I also told her about my experience and how I am now trying to pay for things that I no longer have, don’t remember buying, and have probably already used up or thrown away.

It is getting through to her? I won’t know for a long time. But, in my opinion starting now is much better than waiting until there is already a problem. I am looking for books on money that can show kids how saving can make them wealthy. I don’t want her to have to repeat my mistakes. I hope she can learn from them. Of course she will make some of her own money blunders, but part of my problem was lack of an education about credit, savings, and how it all works.

Talking about money does not take a lot of time. It makes great driving discussion. Just use caution with what you say and make sure they know that you are NOT standing with one foot in the poor house (even if you really are).

Do you have specific advice for talking to certain age children? What have you told your own kids? I’d love to hear about it!!

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