Talking With Your Kids About Money

Talking With Your Kids About Money 05 12 2015Ron Lieber’s best selling book, “The Opposite of Spoiled: Raising Kids Who Are Grounded, Generous and Smart About Money” kicked open the door for parents to start talking with their kids about money. And not just about money, but why making choices is such an important life skill. Who would argue that giving kids the tools to make smart decisions could be anything but life-shakingly positive?

In certain ways, it pairs wonderfully with Walter Mischel’s book, “The Marshmallow Test: Mastering Self-Control.” The book is centered on a test where kids were placed in a room with a marshmallow and told if they don’t eat it, they would get two when the adult returns to the room. The results? The kids with self- control were more likely to have higher test scores, better social and cognitive functioning and a greater sense of self-worth. The connection between mastering self-control and introducing money choices is like PB&J. 

Those who have good money habits and values-based behavior have an important lesson to teach their children through discussion and modeling. The problem: too many adults don’t have the right skills to teach their children.

If you grew up watching your parents spend money trying to show the world their success—you are likely to do the same. Why? Because it is your normal.

If you watched your parents make careful money decisions, that became your normal and chance are you have mirrored their behavior.

But both sets of parents probably never sat down and talked about money making, money saving, charity, needs vs. wants and the “things” families value most.

Ron Lieber’s book is a celebration of great ideas to structure conversations and highlights the creativity and success many families are experiencing by opening the closely guarded gate of personal financial information.

I have yet to hear a parent disagree with the statement that the first job of a parent is to prepare children to be self-sufficient, independent and resilient humans—able to make their way in the world. Yet even so, many parents are appalled at the notion of sharing personal information such as their earnings and the cost of running the household. Lieber’s study illustrates that that is in fact, the right way to go, especially if you’re trying to build understanding, conversation and a sense that “we’re all in this together” as a family unit.

Learning has to start somewhere.

If you have knowledge gaps in your understanding about money, there are many great sources to help you.

If you’re comfortable with your understanding, but haven’t found a reason or a path to talking with your children about money, grab Ron’s book and use it as a guide to opening the dialogue. Talking about choices, self-control, savings, giving, financial security and healthy habits are wonderful conversations.

If you thought handing your kids a weekly allowance was enough of a money education or that parents should simply provide everything their children need, you are in for an eye-opening ride when you read this book.

That old money taboo has been banished forever, in favor of helping to create self-reliant, independent, resilient adults of the future.