Family Finance Series
How Does This Relate to my Kids?
Now that you’ve learned how important it is to create (and stick to) a budget, let’s talk about how all of this relates to your kids.
A key to effective parenting is modeling appropriate behaviors and explaining the consequences of poor decisions. It’s no different with money. Unless things have changed since I got my public education, they just don’t teach this stuff in school. Your kids’ financial education is a class you teach at home, every single day. The best way to teach that class is to model financial responsibility and to set a good example for your kids to follow while interjecting your wisdom and experience at teachable moments.
There are only three ways to use money: spend it, save it or give it away. When you create the habit of saving and giving off the top and then budgeting what is left, you are creating mindful, engaged and empathetic children. And the hope is that when they are old enough to make their own decisions regarding money, they won’t even have to think about choosing wisely because it will be their norm.
As a leader in your home, your kids look up to you. Your view on money will become your children’s view on money. You have to set healthy boundaries and expectations regarding money from the beginning. Making impulse purchases and living outside of your means sets unrealistic expectations and creates unhealthy habits. It also teaches them that they can have whatever they want, right now. Kids need to be told “no” on occasion. These lessons will teach them to delay gratification and will set them up for success in the long run. Even if you never have a single conversation about money with your kids, you will find that they will pick up on more than you give them credit for. For example, in the car about a month ago, a commercial for a credit card came on the radio and my then three year old said to me “Dada, we don’t use credit cards, right?”.
Kids are receptive to a fault and they’re always listening. Make sure that what they hear is going to enrich their lives, not penalize them. Last, having healthy discussions and disagreements with your wife is GOOD for their development. You’re able to model the correct behaviors to use when dealing with conflict. You can communicate healthy negotiation and compromising skills and you can set the standard on how to behave when you don’t get your way.
My family paid off over $75,000 in debt in about 18 months using Dave Ramsey’s methods. If you’re reading this and you want to know more about financial freedom, have questions about your budget or anything else related to finance, please leave a comment below or send me an email at email@example.com