Teaching Kids About Money: Part 1
If you’re a parent, you know there’s no shortage of things you want to teach your kids. The deep values of your family, how to treat others with love, healthy lifestyle choices, the importance of doing your best, how to scrub a toilet…so many important things. We all want to stand back when they’re launched from our homes knowing we taught them all we could.
Teaching them about healthy money habits isn’t the MOST important thing you want to teach them, but it is a hefty aspect of adult life, so it’s wise to put some focus and intention toward it.
Just like anything else, starting early is key. I have served many clients who have asked to bring in their children so I could talk with them about money principles, what assets they have, how things should be set up, etc. This is a great idea; the problem is the clients are bringing in their kids who are in high school or college, and the window of setting up that foundational mindset has already passed. It has not become a consistent way of life for them in their early years, and many don’t have the desire to start that late.
So how do you start with your kids? When?
When our kids were preschoolers, my wife, Kaimey and I had conversations about what we want them to know and how we want them to view money when they are adults. We don’t want to put too much emphasis on it, thereby teaching them that money is the most important thing. Nor that it’s bad to spend money on things we enjoy. (Everyone loves that!) So start with where you want to end up and backtrack mentally from there. What can you instill in your kids now to get there? And what can you build on as they get older?
In this current culture of abundance, most kids have more toys/money/resources than they know what to do with. We talk all the time with friends about how it’s even hard to come up with gift ideas for our kids because they already have so much. We are combating greed, entitlement, and excessive amounts of stuff, so a lot of money education in the home should be about perspective. What is money for? How can we use it to be a blessing?
And just like anything else, it’s also about balance. Balance between saving and spending. Balance money being important with not being the most important. Balance supporting our needs and wants with being generous. In the simplest terms from the beginning, the mindset we are trying to form in our kids is:
Money is a resource to use to take care of yourself and others. It has no value on it’s own; only what you use it for has value.
Money is earned through hard work.
Sometimes money is given as a gift for which you should be grateful and not entitled.
It’s important to save for the future.
You have to prioritize spending on what matters most to you, on what you value the most.
The first step in teaching kids about money is to know where you want them to end up in their relationship with money. Start with laying a healthy mindset and lens around money in your home. Focus on perspective and balance.
The values you identify are most easily taught through continual conversation in your home. And also through hands-on practice of kids managing money themselves. So next time on the blog we’ll be talking about allowances and approaches to kids earning their own money. So stay tuned! But if you haven’t identified your values and what you want to teach your kids about money, start there first. Then you can move into practical management of money with them.
If you’re interested in guidance as you frame the values you want to teach your kids about money, The Opposite of Spoiled: Raising Kids Who Are Grounded, Generous, and Smart About Money by Ron Lieber is a great book. You can also reach out to me as well and I’m happy to help.
