8 Easy Tips for Raising Financially Responsible Kids

Every summer a good friend of mine goes to Martha's Vineyard for an annual family gathering. Over the course of two weeks, dozens of first-generation cousins, uncles, and aunts, ranging in age from 8 to 89, show up to participate in the bonding experience. They sail, put on a talent show, make pies, and have swimming competitions, barbecues, cocktail parties, and blueberry-picking contests.

You’d almost envision a page from a Ralph Lauren ad, showing generations all well dressed in their wrinkled linen shorts, with windblown hair and a seemingly carefree lifestyle.

What this vacation snapshot doesn't reveal is the financial stress some of them are hiding from everyone but their children.

In the grocery store earlier one day, as some of the mothers were buying provisions for that evening's cocktail party, one of the 11-year-olds commented to a cousin, "Put that back. It's too expensive." It was frozen cookie dough.

The two mothers, who are sisters, looked at each other and winced. One of them whispered to the other, "Oh no! What have we taught them?"

People often assume that the ways their parents handled money while they were growing up have determined crucial aspects of their financial lives, such as why they themselves have too much debt or why they change jobs so often. However, there are many contributors to “money messaging” that can affect children’s financial futures more than parents realize.

Too often, parents are consumed with their own stresses and forget to press the filter button when responding to their partner about money, or getting themselves into a battle of wits over whether recycling bags versus turning off the lights in an empty room saves more money.

Kids have amazing hearing — even if they've left the room — when there is tension between their parents.

These suggestions might help if you are looking for ways to break the cycle of poor money messaging.

1. Pay attention.

When your kids are around or within earshot, be aware and make sure any money conversations with your spouse are postponed until you have privacy. 

2. Parent as a team.

Healthy parenting requires having a common goal and being on the same page with each other. If Mom says no to the kids, Dad needs to agree — and vice versa. If one of the team members says the opposite, your children will lose respect for you and learn how to manipulate you in order to get their agenda met.

3. Be firm with borrowing.

If children borrow money from you, make sure you get it back on time. Keeping one’s word builds self-respect and impacts self-esteem more than winning trophies.

4. Be consistent.

Flip-flopping in decision-making creates a loss of respect. Stick with the boundaries you have set. If you promise your children a weekly allowance, give it to them without waiting them to ask for it.

5. Act calm if there is an emergency.

How you behave under stress is a great teaching opportunity. If it's financial in nature, like being forced to move, your humor and gracefulness under fire will help kids build character.

6. Stop fighting and call a cease-fire to the silent war.

Constant arguing and drama will distract children from being available when they are home. Too much time in their room with their door closed might be giving you a clue that the fighting you are doing with your spouse is not as hidden as you might believe.

7. Unplug from technology.

Children need emotional building blocks, which can only be nurtured through interaction with others. Set limits on TV, texting, and computer games. Spend more time on board games, reading, and family activities as a unit.

8. Never hesitate to apologize.

If you admit when you have been wrong, it shows your children you are flawed, just like they are. Not only does this show them a healthy way to handle mistakes, your  accountability also builds trust between you.

Navigating money matters can be tricky with children, but keeping these tips in mind can help you ensure that kids are given a firm foundation for their financial futures.


Pegi Burdick is a member of the DailyWorth Connect program. Read more about the program here.


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