Kids and the Value of Money

Replies to This Discussion

Permalink Reply by Kbot on August 17, 2008 at 1:53

Hi Melinda, wow, your kids are ahead of me!! Think I need to lift my game... ;)

I don't have any kids of my own, so I'm going to go off on a tangent here.

You're spot on that it's never too early to educate kids about money-related matters, but unfortunately it's something that is simply not taught at schools and parents don't think to educate their kids on such matters, so we all become adults who only learn about money through mistakes we make along the way. Which is too late.

Why isn't it taught in our schools? We learn (sorry, we are taught - we don't always learn) about so much irrelevant crap during our 13 years in school - from Latin to poetry to ancient history, but not about how to manage money????!?! As an adult it's probably te most important thing, yet we learn little more than a smattering of economics and how to use a calculator.

Not sure if this is still the case, but if Gen Y are anything to go by, things aren't any better than when I was at school. Will this ever change, or will kids only learn if their parents have enough nous and initiative to teach them the value of money?

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Permalink Reply by Bandwidth on August 17, 2008 at 10:22

I feel one of the problems is that money is seen as a taboo subject and is treated like sex, politics and religion and avoided in conversations.

Finances and money should not be seen as a subject o be afraid of but when parents talk to their children about finances they use shame and guilt terms.

When children see their parent arguing overt the cost of things and or the credit card bills etc what message do you think that sends.

I taught my girls, from a very early age, everything I could about money and at the time I was called stingy, among other things. Since they have flown the coup they have both come back and said thank you.

One thing I learned is that it was harder to teach the lesson than just fix the problem with money.

Some parents use money as a controlling method and are often afraid of the independence that teaching finances will give their children.

Our paranoid laws on finances, designed to protect people from themselves, do not help in the education process.

Schools are funded by govts and large organisation do you think they want people to be finacially independent early in life. Most of their control comes from money.

Money is too often used as a manipulation tool and as such is treated with disrespect

More ideas please

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Permalink Reply by Melinda on August 17, 2008 at 22:45

Spot on Bandwith.
Money was never discussed in our household growing up (except angrily), sex wasn't discussed at all and religion was practised but not preached.
We decided to do things differently and we are pleased at this stage how mature & hilarious some of the outcomes are................
It's lovely your girls appreciate you - well done.
I think if a lot more parents spent the time with their children rather than buying stuff we would have little concern with CC debt!
Furthermore, hadn't thought of school funding in that way before, I guess it begs the question, why then superannuation, why not super-education within the home?

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Permalink Reply by Bandwidth on August 18, 2008 at 12:45

Hello Melinda

Thank you for your compliments

Your goal is highly achievable and I feel the best way to do it is by example. The faster you achive total financial freedom the greater value your children will place on that achievement

Superannuation is an interesting form of independence, is it only given to you after the govt feels you are no longer needed in the workforce, As the worforce ages the age will change and visa versa.

Super is still controlled by the govt.

At 39 I worked out what I would be worth whne I was 55 and it scared the crap out of me. So unlike lots of others I decided to do something about it. I set some financial goals with some time frames. When I achived the goals early I reset the amount and the time. These goals are discussed with the girls

I believe and taught my girls that financial goals should always make you feel uncomfortable and when they start appearing easy it is time to review them.

When people say when is it enough I say most of the fun is the challenge.

I got a real compliment on the weekend when a good friend of mine, who has been a bit shy about talking money, said "can you teach me and my son how to money plan and share trade that looks like the way to go.

My view is that most things in life are privledges, what is a right is to be taught independence. Govts, corporations and other bodies need us to be dependent.

We taught our girls to be financially responsible/independent so when they said "get real dad we are leaving home" we were very comfortable, knowing they would do well.

We always told the girls we would maintain a supportive family household as long as they needed, just remember that needs and wants are radically different things.

The girls have been told that when we turn 60 they will be running the family trust. We have the faith in them.

I said to my eldest that we were going to be SKINS (spending kids inheritance now) and she said that I don't have the mentality and the family trust will probably be making money out of the nails we use in your coffins :-).

They were taught that if they borrowed from us, it was only to fix cash flow problems and the faster they paid it back the higher the chance it would be there again.

Financially we all have confidence in each other and we all have full access to each other's bank accounts so we can bail each other out, if necessary. The girls have been told if anything happens to us clean out the accounts then the creditors have to negotiate with you.

All said and done I think the greatest gift anyone can give their children is financial responsibility, from that will come the independence.

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Permalink Reply by Tony Aloisi on August 19, 2008 at 19:42

Sounds like my youth!!!! How things are different now - congrats on successfully teaching your kids the value of money. If only all parents had your attitude towards such things.

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Permalink Reply by Melinda on August 17, 2008 at 22:38

Well Kbot you're already doin' scores more than what others are participating in..........................
You're aware and admitting your game needs lifting *hey* & who's doesn't?

It was always a beef of mine at school, many years ago, that we weren't taught the practicalities of life in Math however Home Economics did briefly touch upon it.
I'll be waiting with bated breath to see what our eldest brings home from secondary school in 3 years time............

Good luck in raising the bar on yourself too..............keep saving, Melinda

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Permalink Reply by Karen on August 17, 2008 at 14:02

Hi Melinda, your kids are lucky to have a Mum who is giving them a leg-up in the world. If only my kids had been so lucky...

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Permalink Reply by Melinda on August 17, 2008 at 22:48

Karen, don't be so hard on yourself, you know it's never to late, you can always educate yourself and inevitably pass on little tidbits to your kids, no matter how old they are.........
Point them in the right direction and if possible give them time and web-sites to peruse.
God bless you and good luck!

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Permalink Reply by Karen on August 18, 2008 at 17:25

I realise that it's never too late, but I think my focus will be on me now that the kids have grown up and are out on their own. I'd try to teach them now, but given they're in a "not listening to their mother stage" (which will probably end when they have kids), I can't teach them much about anything right now. Ah, Gen Y - they know it all!!!

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Permalink Reply by Bandwidth on August 19, 2008 at 12:42

Hello All

Found an article on this subject on another site

EVEN IF you’re not the world’s most successful personal finance manager or wealth creator, you can still encourage your offspring to learn and apply some basic money principles which will help them avoid the usual money traps. Financial planner David Raits shares the three things they should know.

http://www.superliving.com.au/StoryView.asp?StoryID=243018

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Permalink Reply by Bandwidth on August 19, 2008 at 13:06

I think another thing we need to teach our children is to have respect for the wealthy.

How many times do you hear "they have got lots of money they must be ripping someone off" or "look at them more money then sense" or "you can't get that rich without taking advantage of other people" etc etc.

These message tell out children to be suspicous of the wealthy, rather than looking on them as potential mentors.

I feel we need to ensure our potential jealousy and negative attitudes, toward money is not passed on to our children. My mother actively discouraged my entraprenuarial ventures, as she felt they were too risky. Looking back I wish I had been able to learn some of the lessons earlier rather than later. I, fortunately have developed opportunistic skill later in life, sometimes in spite of my parents.

My view is we need to guide our children and be there for them when they fall in the inevitable holes, being carefull not to instill negativity and or fear. I remember a saying "It is the fight to get out of the cocoon that give the butterfly the strength to live"

As mentors if we restrict our children's activities and curiosity, too much, they will do it out of our sight and care. To "tell" most children not to do something they really want to do means it i just going to take longer to do.

In the area of finances our children will mimic us until they find something better. My preference was to have them mimic me when taking the first steps in a fruitfull journey. This attitude has created the condition where my girls come to me for advice when they feel they may be stretching their own boundaries, this is a wonderful feeling.

BTW my girls have said they would rather borrow from the banks as they are easier to deal with and ask less questions :-)

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Permalink Reply by Manish Dev on August 19, 2008 at 13:51

This attitude toward the rich is part of the "tall poppy" syndrome that exists in Australia - where we pull down those who are successful to make ourselves feel better.

This is in contrast to many other societies, both Western and other, where the successful are put up in lights. Here, sadly it is only with sporting stars that this happens. Not sure how this can change.

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