...of Teaching Good Money Management

Talk It Out:
Helping Children to Learn about Frugality


"When you have kids and live simply, what do you do when they see others living large? Kids have a hard time understanding. For example, my brother, who is a wonderful guy, lives big. His family owns 2 quads, a huge RV, motorcycles, expensive computers, and the kids all have cell phones (as young as 10!). Everything they do is big. Their finances show it because they have terrible debt. My brother works long hours because they don't limit their spending in any way. So much of our society lives this way. The funny thing is that those of us who try to teach our children basic, old-fashioned values are seen as the crazy ones -- especially to our kids. Nancy, when you say that creative frugality means not depriving your family, how do you convince your kids you aren't doing exactly that? I firmly believe in what we are doing and I try to teach my kids to be conservative and count the cost of decisions. But it's hard for them not to be jealous sometimes. I grew up in a family that did not have much money and I wouldn't trade that for anything. We had a very full life filled with wonderful memories and good values from my father who worked hard. The world has changed and those things aren't valued anymore. It's difficult to keep kids grounded these days in a world of ‘got to have it now’ and credit cards. I'd be interested in how others approach the same problem. I don't think I am the only one who has gone through this." ~ Mary Ann


Responses:

"Our solution lay in putting our children on salaries.  As parents we decided what financial obligations the children would be responsible for and the amount of money we already spent on our children for clothes, shoes, events and activities etc.  We give them the total amount of money at the beginning of the month.  They are now responsible for how it gets spent.  For instance if they decide to spend all the money on snack foods or computer games they will not have enough for clothes or birthday presents.  Our children caught on right away. They have all become very frugal spenders and know how to tithe, save, and spend responsibly. They are not caught up in big spending because they realize how far their money will go and they know they will not get anymore from mom and dad. Mary Hunt has an excellent book on the subject called "Debt-Proof Your Kids" which is where I heard about the idea originally." ~ Anita in Canada

"Until my children became teenagers this was not a problem. When the requests started for cell phones, Playstation 2, and cars I simply sat down with them and explained our budget and showed them that the money just wasn't there for these items. They were told that if they really wanted a cell phone, etc. that they were going to have to pay for it themselves. They also had to maintain good grades in school or the job would have to go. My youngest daughter went out at 15 and got a job working as a carhop at Sonic. She is graduating this year after completing a three year graduation program, has maintained honor roll grades and is still working at the same job. She has purchased her own pick-up truck, pays her car insurance, buys her own clothes, any extras that she feels are necessary and is still seeing her savings balance increase. Now that she is having to determine if an expensive item is really something that she needs a lot more thought goes into the decision. Since she started driving, we have gotten a cell phone for her (more for our peace of mind) but she has chores that must be completed for this to continue." ~ Pat

"I wish I could remember the exact book or program that brought up this point, but a good way to emphasize to your children the costs of 'having it all' is to stress 'we can buy this expensive item, but then I must work ## number of hours to pay for it. I have ## number of hours less time to be with you, play with you, etc.' I think this may be the Your Money or Your Life philosophy . . . of stressing the time lost to purchase those 'extras.' This seems to work very well with children, who in most cases will choose the time of their parents over the expensive extras when they really sit down and discuss the options." ~ Jan


"I feel that kids learn by way of the example that we as parents set.  I've always said that when we don't buy things to eat or drink when we go to the zoo or movies, then we can go more often. I've never used buying things as a bribe for my kids to do anything or just for behaving at the store. It is just expected of them. Because of this, they never whine for us to buy them things. I let them go with me to the thrift stores to buy certain things. They don't care if a game isn't new, as long as it's fun. My daughter doesn't like to wear the same thing as everyone else, so she'll buy clothes at the thrift store and 'reconstruct' it into something very unique. I taught both of my kids, even the boy, how to sew. They've sewn their own gifts and know how to repair things. I make sure they know how much we save because of coupons.  The other thing is we taught them very early the difference between a want and a need and also encourage them to save any extra money they have." ~ Carol

"Give the kids time. Hopefully, they will one day appreciate the calmer home life and lack of tension that can be had by having parents that don't live under the burden of enormous debt and the strain it can put on home life especially if 'keeping up with the Jones' means both parents working long hours. Have faith in your values. Someday your kids will appreciate them. 

Here's an object lesson about debt.  Put a backpack on the kids and then get a pile of various size rocks and advertisement pictures of all the objects they desire. Let them 'buy' the objects, at retail value, with the various 'denominations' of rocks, then put the rocks in their backpack and have them carry the backpack around while they do chores, play with their current toys, etc.  Ask them, do you want to go through life carrying a burden of debt?  There is freedom in living within your means." ~ Sherrie in ID

"We took Dave Ramsey's Financial Peace for the Next Generation with 28 other homeschooled kids in a class at a church. That was the best attitude adjustment our teen has had!  This program is available to public schools--in fact it was prepared for them. Our teens took a field trip and took turns sitting in on the live program in the Dave Ramsey studio, got their picture made for their yearbook with Dave himself, and toured the building. Now we listen to Dave Ramsey sometimes on the radio. Now he's cool.  He says the paid off mortgage replaces the (forgot what kind of ) car as the new status symbol of choice. The videos were segments of Dave Ramsey lecturing folks at events. The kids had workbooks, assignments, and best of all, they were assigned to be part of a 'family.' Each family drew work assignments and pay schedules and family size from a hat.  They had to make budgets that worked for their family. Each week they would have new challenges presented to them. Parents were special guests--talking about assigned topics that they had experience with. One mom talked about living on social security.  I said, 'Oh, so you're a widow? I am too.' Some invited guests talked about their area of expertise. One person worked in bankruptcy court. Another worked at a used car lot. Another cool thing was that each teen was given a card that looked like a credit card, but it talks about paying cash for stuff--I've forgotten what it says (it's from Dave Ramsey)--but our 16 year old carried it in her wallet as a status symbol!" ~ Judy

"As a Kindergarten teacher I can tell you firsthand that the mind of a child can be strongly influenced by the amount of time spent in front of a television.  Very young children not exposed to constant television do not develop the 'gimmes' that are seen in so many children today.  That is step number one. Families that spend quality time together and have fun will offset a lot of 'things' that many parents dump on their children in the name of love.  I do not believe in condemning big spending families to children as 'bad' just not having the same values as your family.  Don't be too frugal with children either....a small weekly treat is necessary...such as an ice cream cone at a restaurant, buying a favorite cereal, renting a video....just don't get carried away! Children need responsibility too. Have them earn an allowance to spend at a thrift shop!  They will see very quickly that their money goes further there than at the mall.  Be creative, loving and firm in your commitment to your values." ~ Anonymous

 

Editor's Note: Thanks to everyone who took the time to respond.

 

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