It’s a sad truth of our modern society that few kids enter the world of adulthood with any kind of financial knowledge beyond how to spend money. It used to be that parents taught kids the value of hard work through a system of chores and allowance, but these days overworked parents seem to dole out the dough without complaint rather than taking the time or energy to hound their kids to earn the money they receive. And how many parents in this day and age teach kids to balance a checkbook, keep a household ledger, or create a budget? How many talk to their kids about the perils of credit card debt, or the value of saving for retirement? How many discuss investment options? The answer is clearly too few.
So it’s no wonder that most adults are deep in debt and living paycheck to paycheck. And if we can’t even get our own finances in order, how can we possibly expect our government, made up of people who have likely grown up with little knowledge of finance themselves, to balance our country’s budget? It’s a problem with multiple facets. But parents can only control a small part of it, and the answer can start at home. In Steve and Annette Economides’ audio book, ‘The MoneySmart Family System: Teaching Financial Independence to Children of Every Age’, you might be surprised by all that you can learn along with your kids.
Plenty of parents complain about their kids having a sense of entitlement and blowing through money like it grows on trees, but then gladly hand over twenty bucks every time their kids hold out a hand. And they wonder who’s to blame. The worst part is that the ones who will really suffer in the long run are the children themselves. As they enter the real world expecting handouts they’re going to have to learn some very hard lessons about the way things actually work. Nobody is going to take care of them, and without basic money management skills they’re only going to sink further and further into debt.
But there’s a lot that parents can do to turn the situation around, mainly by imparting lessons that will teach kids how to budget their money so that they can earn and spend wisely. The best time to start is when children are relatively young, but according to the Economideses, financial lessons can be taught at any age. And the way to make kids responsible for spending is to make them earn their own money, at first through chores and eventually with a real-world job. You can also teach them to be grateful for all that they have and to share with others less fortunate. In addition, you can help them with major expenses like a car and college, but you also need to make them pay their share, as well as work with them to find ways to cut costs and live within their means, whether that means buying a used car or attending a local school and purchasing discount textbooks from slugbooks.
As children move into adulthood, it is important to give them the knowledge and skills that will allow them to approach their financial future with confidence. When they know how to make smart decisions where their money is concerned they can lead independent and fruitful lives. Every parent wants the best for their kids, and that includes a solid financial future. By listening to ‘MoneySmart’ you can get your own education in order to prepare your children for financial responsibility. And it’s never too soon or too late to get started.