If you’ve already taken the step towards discussing your finances with your children, then you’re much ahead than the other parents. According to a survey done by ING Direct, one out of three parents are more prepared to talk to their children about matters such as alcohol, drugs or even sex, than talk to them about money matters.
The reason for this simple – parents don’t receive formal training on how to go about teaching their kids about money. Which is similar to most people not getting any real education in managing their own finances. Due to this, most parents approach the topic via the “trial and error” route and feel confused midway.
For example, if you use a discount coupon such as the Cost Plus World Market coupon when shopping for furniture with your kids, would you care to pause for a moment and explain to your child how you’re saving money by doing so? Most parents won’t, and due to simple things like these, they end up making mistakes when teaching their children about money. Let’s discuss a few such mistakes in the following article…
Mistake #1: Saying Too Little
Avoid keeping your children out of the loop during family conversations that revolve around money. By the time your child reaches the age of 12, he or she is old enough to understand and weigh in some of the financial decisions and will like feeling responsible. For example, when you’re planning a family vacation include him by showing how you can go for a particular hotel that serves free breakfast and hence helps you save money.
Mistake #2: Saying Too Much
Yes it is definitely important to open up with your children about money, but that doesn’t mean you go overboard. While it’s okay to tell your child how you’re saving money on the grocery bill, it’s not okay to tell him or her how costly your divorce was as it can make the child feel bad even if you didn’t intend to do so. So keep the sensitive family issues aside and keep your money education healthy and fun. Say what needs to be said and nothing more than that.
Mistake #3: Attaching Strings
Whenever you’re thinking of buying something for your child, either buy it or avoid buying it, but don’t make the mistake of attaching strings to the purchase. This simply means that if you have decided to buy your son an Xbox gaming console, reminding him over and over again that you’ve got it for him or making him feel guilty about it isn’t such a nice idea. Of course, there’s no doubt that you should be expecting him to thank you for it, but you shouldn’t give an impression that he owes you something in return of what you bought him.
Imagine yourself at an airport where you have options in everything – right from various ground transportation options to food options. Would you go for anything that comes your way? Or choose your options carefully? You’d of course go for the best deal in everything so that you have a smooth flight that’s on budget. Similarly, your children will come across a number of options in life in different areas where money is involved. They need to know how to deal with money so that they choose the right option and be smart about saving.