Let’s face it, no one wants to talk about budgeting. It can be boring and even stressful for adults, and it’s so much worse for kids. Given current circumstances, you may be having to cut back quite a bit and very suddenly.
Having these tough and sometimes unpleasant discussions is never easy, but it is necessary. We’ve come up with some tips to help ease the pain for you and your children.
Let’s Talk About: Financial Conversations With Kids
Your kids will learn about money and spending habits somehow, so why not it be you?
Rather than focusing about the dollars and cents, direct the conversation about values. Forget about the “ideal salary” or “you need to save this amount this week”.
Focus on the concept and importance of savings, planning and giving back. It can be tough for young children to wrap their heads around the complexity of the subjects, so following these tips can help ease the burden.
Start With Savings & Hard Work
You don’t need to sit down with a full-on presentation. Just start by answering questions that relate to them. Take note of what matters to them; such as a new dollhouse, action figure or book collection, and weave them into the conversation.
Take this as an opportunity to show them how they can earn money. Maybe this is by doing chores or nice deeds, but they will soon learn the worth of hard work.
What To Say: “Hey honey, remember the toy car you saw last week? We can get it if….”
Keep Them In The Loop
With every tough conversation, always be honest. Remember that the delivery is just as important as the message.
Whether it’s good news such as a raise or bad news like retrenchment; be clear of what you want them to grasp and what is expected from them. Never make empty promises, and it’s plus point if you allow them to share their opinions.
What To Say (Bad News): “We only have enough money for very important things right now such as food, clothes, electricity and water. What do you think is important for all of us?”
What To Say (Good News): “When you work really hard, you might get a reward like I did. What are some of the things you’d like to be rewarded with if you…”
Mistakes Are Okay
One of the hardest parts about teaching (and learning) about money is that there will inevitably be mistakes, and those misjudgments result in real, tangible financial loss.
Younger kids might still not grasp the concept of “working for your money”, while older kids might waste away their weekly allowance. It’s easy to take away that privilege forever to let them learn a hard lesson, but keep in mind that it may take some trial and error (and a lot of patience on your part) for kids to learn good habits. The first step is to understanding why they did what they did.
What To Say: “I think we both know that was wrong, could you tell me why you did that?”