Today is part two of our series with financial expert and author, Dr. Karen Monroy, Ph.D. Last week, Karen was featured in an interview about her new book, “Mommy, What is Rich?” a children’s book that focuses on teaching kids about the foundation and core values of true wealth. In this article, Karen writes about how parents can engage their children in communication about money and spending.
Financial expert and author, Dr. Karen Monroy, Ph.D.
Teaching Kids Core Values About Money
written by Dr. Karen Monroy, Ph.D.
When you think about teaching young folks about money what comes to mind? When to give them an allowance? Teach them to save? How about the dollar value of what they desire? Those lessons and others make sense, but here is the mistake nearly everyone makes: trying to teach these kinds of tactical lessons first, when these lessons should be after. “After what…?” you ask? After the foundational concepts that involve your core values.
Let’s assume you value teaching independence and self reliance. This means one tactical money concept you would be addressing is the issue of balance — spending what you have to spend and not more. This is juxtaposed to the “gimmie monster” that takes most young folks over when they want something–that and the “now-monster.” When the “gimmie monster” and “now monster” tag team up in the grocery store or gift shop –watch out… everyone is in for a rough ride. Do you make a child feel bad about wanting? Do you make a child feel bad about not understanding the value of objects purchased? Or do you make the child feel bad for not being able to wait for the object? Not consciously, I am sure, but think about your upbringing. Did you feel bad from time to time about wanting something and thinking about how your parents would suffer to give it to you? Or your parents getting mad at your wanting it?
What if you were to teach your children that wants are a part of life and that they do not have to respond to every want they have? They can notice it, observe it and realize, “oh this is a want and it will change, wants always change.” What if they are taught other foundational concepts like, “I am not bad for wanting, but I am in control of my response to the want.” Think about the quality of the purchase decisions they can make being free of the dynamic duo: “gimmie monster” and “now monster.” IF BTW, you have either one of these monsters, it will be hard to teach your children anything else.
Children follow what we do–not what we say. Even if we are honest about the troublesome nature of what we do, and direct children to not copy us—they do anyway. This is actually the biggest hurdle I see. Parents fail to look in the mirror and say, “I do that” when it comes to their children’s bad habits. Sure, the form of the habit is different—but the underlying value is the same. If the parent is an unconscious consumer with the grocery budget—impulse buying whatever they please—then it is hard to ask a child to go to the store for school supplies and only pick 6 items on their list.
Learn to look at the circumstance that you find upsetting with your child’s money habit as a great opportunity for what you need to “clean-up” in your life so you can teach them! Don, a client of mine who has sent his kids to my teen boot camp workshop complained to me his daughter, Sophie has returned to asking for one “trendy” item after another. While true Don was a loose spender at one point, he reformed his ways. In a review with Sophie, she said, “Dad just bought an ATV, mom just bought a new laptop. And this is after buying new cars.” Sophie’s parents had broken two rules I teach: Not communicating about purchases and seeing things from the child’s eyes. It looked like to Sophie they were spending away—so why not her too? Don did “clean-up” with Sophie. He explained they had actually been saving for those cars for 3 years. They decided not buy as expensive cars as planned so they could purchase two items each parent wanted: The ATV and laptop.
You are always communicating about life to your kids. The good habits you have and the bad habits you have. Money is a big part of our life. Take a look at these Do’s and Don’ts around everyday teaching moments and money communication.
Don’ts:
- Never talk about money
- Always try to get things free.
- Worship money or equate money with being powerful.
- Say things like “do I look I am made of money?” or worse “I don’t have any money.” In the grocery store, if your child wants something that isn’t in your budget, be clear on what you have CHOSEN to purchase, “That is not on our purchase list this week. All of these other items are,” as you point to the grocery full cart.
- Make a child feel bad for asking for something. We all have wants and desires. Be sympathetic, “I understand other kids may have one of those—and if you want to put it on your birthday list, or if you want to earn money to pay for half of it—let’s talk about how you can do that.” Be the coach. Brain storm solutions.
- Feel bad, guilty or inadequate for not wanting, or being able to buy something for your child. Either they will use it against you, or take on your guilt and feel bad you feel bad.
- Complain about what you spend like you are victim. If you do not like your cable bill or cell phone bill or holiday bill—act powerfully and change it. Do not say, “I have to pay it”. Even your taxes you can reduce if you want to!
- Use credit cards in front of your kids, without communicating the responsibility attached to it. (i.e.: credit card for soccer ball purchase: “I am glad I have the convenience of the credit card, but the bill will be due in 20 days and I will pay it off before then.” To a very young child “this is mommy’s re-pay card. I have to pay back this money in 20 days”
- Encourage your child to only save, or hoard. Flow, releasing and returning is how to feel comfortable with money Tell a child you will help pay for something without giving 100% of the details. (I will pay 50% of the new bike not to exceed 100.00 dollars)
- Buy things and not use them. Recycle items, garage sale items; fess up if you have made a mis-step or helped them make one. How many gaming systems does one house need? Responsible consumerism: Take care of what you have, be mindful of the “bigger and better” syndrome.
- Rescue them from choices they have made. If your child leaves expensive jeans on the floor, do not pick them up! Let the child know you can see they are not ready for the responsibility of caring for things and this will be taken into consideration with their next request.
Do’s:
- Money is an energy—where both the giver and receiver are blessed by the exchange of energy or it is being misused.
- Teach money is a tool and that balance and flow are critical. A budget is helpful in achieving this. Talk about your budget when and where appropriate with your kids.
- Take advantage of back to school, holidays—state the budget and help brainstorm how to stay within the budget (baked goods, hand made cards) Sit down and work it out with them–assign dollar amounts for each gift to be purchased. Gratitude—look always at what you do have, express your gratitude for it.
- Let your child earn things in life! Do you do their homework for them? (let’s hope not) Then do not do their earning for them. Let your child see you give without strings or judgment and with joy. One time my son asked why I gave a homeless man some money. I replied, “for the pure joy it gives me and to thank the universe for what I do have.”
- Let your child see you consider purchases with responsibility. A refrigerator? Great! Share how you compare prices, models and the best return on your investment in the exchange of money for goods.
- Pay what something is worth. What goes around comes around.
- Be mindful. When at the ATM, does your child know the hard work that went into fill the account so you could get money out? Or do they think of it as the magic money machine? Ask, yourself constantly, “How would my child see this?”
- Be precise in your language. No cash in wallet? Say, “I don’t have cash with me right now, I’ll come back later when I have cash” Don’t say “I don’t have any money.”
- Be honest. Don’t want to spend the money? Then say, “I do not want to spend the money on that item. I don’t see the value.”
- Get comfortable with “No”, sympathetic with the desire. Set limits, and budgets that change with age and need.
- Let your child pay for things at the counter, and get the change back. If they need help with the math. Help. If you are hiring your child for a job, give them indicators of the job done successfully. Mowing the lawn? Sweep up clippings, lawn mower and accessories put away, can’t see any long patches of grass, etc. Make sure you demonstrate as many times a necessary how to do the job they are being paid for correctly. “If you want me to pay you, then the finished result needs to meet my standard, not yours.” Sound like real life?
- Let your child see you invest responsibly. Including with your home—it’s your biggest investment.
- Invest with integrity. Do you claim to be green and own oil stocks? How about a health nut and have tobacco stock?
- Let your child know desires are part of life and they are okay. It doesn’t mean a temper-tantrum, nagging and whining are okay. There are consequences to bad behavior! Life is set-up to get some things you want, and wants always change Experience the consequences of choices, good and bad. Most of us can afford what we choose to in life. Have you seen someone drive a big expensive car and live in a shack?
- Communicate to the child; they have the freedom to choose what they desire. Everyone’s’ desires are different. Don’t judge what others value. Money energy should follow your values. Love music? Then your budget should have some money for that. Family first? They money should be devoted to re-unions, vacations (even if it is a vacation at home!) or family game night.
- Be mindful of the shadow side of money. Everything has a shadow side and it is a parents role to at first shield a child from it and then teach them navigating around it. If you brag about getting paid for 40 hours of work when you did 30 expect to find your child shorting you at some point.
- Speak from the I point of view “I find this situation very difficult to resist. I really want this item. But I know something has me hooked, so I am going to walk away and think about it.” We all know there is always another of whatever it is we want—no matter what the sales guy says.
Karen is a prolific writer who is passionate about teaching the foundations of Sustainable Prosperity. Her book for adults titled, “30 Day Money Mastermind Makeover” recently won an Indie Excellence Award in the ‘Specialty Books’ category. Be sure to visit Karen’s blog at http://www.KarenMonroy.com/blog.
