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Kids and Money: Are You Overburdening Your Kids?

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Teaching your children about money is important. Indeed, money management is one of those really essential life skills that your kids will require later in life. However, it is important not to rush ahead before your children are ready for certain concepts. Additionally, while you want to talk about money and get your children used to the idea of money, it is important not to overburden them with financial worries that are too much for them.

As you teach your children about money, keep a few things in mind. That way, learning about money will be a more positive experience, rather than turning into a nightmare for your kids.

Age Appropriate Money Lessons

My eight year old isn’t exactly ready to grasp the ins and outs of the stock market. A four year old is going to have a little bit of a hard time understanding the abstract concept of interest. And many young children aren’t going to be able to understand that your debit or credit card isn’t some magical payment device. I’ve had to explain to my son numerous times that the debit card doesn’t work unless I put money in the bank first. He’s starting to get it, but it’s taken a while.

When teaching your children about money start with concrete examples that young children can grasp. Start with simple concepts, and build on those over time. Don’t try to teach your children everything at once; they will just become confused and frustrated — and unable to cope.

Walking the Line Between Protection and Honesty

One of the hardest things to do is walk the line between protection and honesty when it comes to your family’s financial situation. In some ways you want to protect your child from the struggles you are going through. However, older children know when there’s a problem. If you are stressed because of money, you can outline the situation to your child, explaining that things are a little difficult right now. Older children and teenagers might be able to better understand the situation, but it is important not to place too much responsibility on children to help solve the money problems.

While you can explain the issues, and ask for some assistance in the form of less spending and asking the teen to be more responsible for his or her own “fun” expenses by using money from an after-school job, you don’t want your children to feel as though they are the cause of the family budget pinch, or that they have to solve the problem.

Adding Optimism to Money Matters

Sometimes, a little optimism can help your child avoid feeling burdened by the money problems in the family. Focus on the things that you have, rather than the things you don’t have. Model positive behavior of contentment and frugality, and your children will feel better about what they have. If you are concerned about your financial situation, you can frame it as an opportunity to grow stronger as a family. “We’re a family, and we can all help to get through this situation.” Be sure to praise efforts made by family members. Compliment your children on their efforts, and thank them if they offer to contribute to the family finances.

As with many things in life, your attitude toward money, and how you approach a difficult situation, can make a big difference. If you are honest, but optimistic, your children will be informed, yet not feel oppressed by be the situation. If you complain constantly, and show constant anxiety, those reactions will transfer to your children, overburdening them and increasing tension in the home.

How do you avoid overburdening your children with money matters?

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8 Responses to “Kids and Money: Are You Overburdening Your Kids?”

  1. Huskervolleybfan says:

    I am looking for online courses or games that will teach a high school sophmore about investing. My grandson has suffered an injury and will have time this summer to learn more about how to handle money. Does anyone have suggestions?

  2. Adam says:

    It’s interesting that extensive taxpayer money is used to find teaching kids about the ill effects of drugs, unsafe sex, etc, yet little, to no funds are used on curriculum about money management. Unfortunately, it appears that our children and grandchildren are going to learn a painful lesson when the national debt, which we created, is stuck in their laps to solve.

  3. Rob O. says:

    I’ve said it before and still firmly believe that one of the best things you can do to help your child become financially savvy is to stick with physical money. So many financial concepts are quite abstract and difficult to grasp even for adults, so working with actual cash money is a great way to make finances more concrete.

    At (just-turned) 5 yrs old, our son understands some basic concepts of earning, saving, and the financial consequences of certain actions. He recently scaled up the refrigerator shelves while I was distracted with laundry in the next room and got a glass bottle of grape juice. After he helped clean up the mess from the shattered bottle, he also had to pay ($1) to go towards the next bottle of juice. He was very upset about having to fork over his hard earned money and it broke my heart at the time, but by golly, he remembers that and referenced it just a day or two ago, saying “I better not bother Momma’s tea glass because if it breaks, I’ll have to pay to replace it.”

    • I totally agree Rob. It is critical for children to see cash being used because they need concepts to be tangible in order to understand them. Letting them count the money, help to pay for things at the grocery store and divide up money they receive helps them get the practice and experience they need to develop good long-term habits. Parents are the most influential financial teachers a child will ever have so it is essential for us to give our children plenty of opportunities to learn how to manage money on a day-to-day basis.

  4. poscogrubb says:

    Just for giggles: My six-year old doesn’t understand what change is for. When we play “store”, she always likes buy my cookies by paying extra so she can “get money back”. My wife have gone over this scenario with her several times: If she has $10 to start, and she wants to buy something that costs $1, how much money will she have left over if she pays $1? How much will she change will she get if she pays $5? How much money does she have now?

    She always answers these questions corretly, never forgetting to add, “But I got money back!”


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