And like most important lessons, it isn’t just what you tell them to do, it’s how they see you operate every day. The values you demonstrate will shade and shadow your kids’ money behavior for the rest of their lives.
And it starts early. Kids are like little sponges who absorb everything (like repeating that four letter word that just slipped out of your mouth).
So rather than letting your kids ONLY learn by example, consider these seven conversations to help your kids learn how to make money work for them:
- Money is just a tool. Having money is not an objective by itself, but a means to live your life with options and a sense of security. This is a great lead-in to talk about work and what it takes to make money.
- The Money Game: First you save, then you pay your bills and then you can use your money to help others or treat yourself. Try playing the money game as a family and create shared goals.
- No shame, no blame. There are those who show their wealth readily and steadily, leaving your kids to feel “less than”, while others seem to have less than your family. Talk to your children about richness and success being about the shared values of your family, not about acquiring things or judging others.
- Money doesn’t buy happiness. The goal of money is to give you options and a measure of security. Help your kids see that handling money wisely means they can help make their dreams happen. Showing them balance—of what they need/want today vs their hopes for the future—can bring them closer to happiness.
- Bad stuff happens. Sometimes people lose their jobs, they make money mistakes or their plans don’t work out the way they expected. It’s not the end of the world and we must get back up after being knocked down.
- Goals matter. What do your kids value—learning to play the piano, acting in the school play, going to college to become a fill-in-the-blank? Show them that not only are goals important, but they’ll need a plan to work toward what they want.
- Success takes effort. There is no true “overnight success”. It will take work, persistence, time and patience to achieve your goals.
Think of these conversations as fire-starters.
Whether you have them around the kitchen table, in the car or while couch surfing, your goal is to make them aware of how money works.
And then, you’ll want to lead by example. Because your kids will usually instinctively decide (without much conscious thought) to imitate YOUR saving and spending habits. Your normal becomes theirs.
Your frank conversations and the examples you set can be the difference between success and a life of money difficulty. It’s far easier to give them the gift of good habits now, then watch them attempt to unravel money misery later.