Making money your children’s business, too
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Making money your children’s business, too

Rifka Schonfeld

H

ow many times have you responded to your children “none of your business” when they have asked you how much your house cost or some other financial question? Do you ever consider bringing your children into the conversation when you are making budget decisions that affect them? Does the thought even cross your mind?

Ron Leiber author of the “Your Money” column said we should be having these conversations with our children. In fact, as Mr. Leiber writes in his book, “The Opposite of Spoiled: Raising Kids Who Are Grounded, Generous, and Smart About Money,” these conversations are very much our children’s business.

“We push our children’s money questions aside, sometimes telling them that their queries are impolite, or perhaps worrying that they will call out our own financial hypocrisy and errors,” he said. “Sometimes we respond defensively and viscerally, barking back, ‘none of your business,’ unintentionally teaching our children that the topic is off limits despite its obvious importance. Others want to protect their children from a topic many of us find stressful or baffling: Can’t we keep them innocent of this money stuff for just a little bit longer? But shielding children from the realities of everyday financial life makes little sense anymore, given the responsibilities their generation will face…”

Mr. Leiber said we do our children a disservice by not sharing our finances with them. They do not learn how to spend, save, or give to other people because we have not shared with them our methods and thoughts about these processes. Instead of shielding them from money issues, we force them into ignorance that will ultimately harm them later in life. In psychologist Madeline Levine book, “Teach Your Children Well: Why Values and Coping Skills Matter More Than Grades, Trophies,” or “Fat Envelopes,” Ms. Levine points out that our society that is focused on chasing success (often financial) leading to children who lack self-esteem and experience themselves as failures.

This is the opposite of what the parenting is. We want to raise happy, grounded, resilient children. According to Mr. Leiber and Ms. Levine, having open conversations about money is part of that. Mr. Leiber suggests six steps for changing the conversations about money.

Give your children allowance and ensure that they have a regular place to put it – a bank account, wallet, or jar. The amount of the allowance does not matter much. What is important is how the money is divided: Spend, Save, and Give. Explain to your child about what percentage you spend on things the family needs (or wants), how much you save for the future, and how much you give to charity. Your child can decide what percentage he or she would like to do but making and sticking to a decision is the first step to financial intelligence.

Family conversations. Don’t shut children out of the financial conversations. Tell them how you make financial decisions so that they can learn about tradeoffs. Maybe you just did a renovation, but that means that you won’t be taking a vacation this year. Or maybe the afterschool activity they are doing means that they have to choose a different summer camp to attend. Your income and expenses affect them, and they can learn from being part of the conversation.

Draw a line between wants and needs. Explain why certain things are wants in your family but might be needs in another and vice versa. This can help your children define exactly what things are most important to you.

Keep track of they spend, save, give tallies, and have discussions after about how they feel about it. Maybe they wish they had spent less or maybe they were happy with giving but would prefer a different tzedakah next time. These conversations keep them accountable and teach them about smart spending.

Find someone you admire in terms of his or her spending, saving, and giving. Talk to him or her about the decisions he or she makes. How do they keep their emotions in check around financial matters?

Don’t shy away from financial conversations in the future, but obviously keep the anxiety out of the conversation. In fact, keep the dialogue going in your household. In the long-term, your children will be better prepared for their financial futures.

Rifka Schonfeld, a longtime educator, is the founder and director of SOS, servicing all grade levels in general and Hebrew studies. She also offers social skills training and work that helps youngsters self-esteem and other issues.
www.rifkaschonfeld.com, rifkaschonfeld@gmail.com, 718-382-5437.

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