7 Lessons Every Parent Should Teach Their Kids About Money
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Money fights and money problems are a major reason for divorce. Consumer debt is $3.2 trillion in the United States. Our Government debt is $17.9 trillion. Seventy-six percent of Americans live paycheck to paycheck.
Our family has had its own share of financial disasters, which were a result of failing to control our personal finances. We made poor decisions that left us desperately needing a change.
I fear for my kids’ financial future, I fear that they will make some of the same mistakes we made. In a world devoid of financial sense, they will need to swim upstream against cultural norms to have a prosperous future. Taking a passive approach won’t prepare my kids, or yours, for what they will need to face. Here are seven lessons that every parent should teach their children about money.
Abundance. We have two ways to look at money. One is with scarcity, holding on to what is ours. This will lead to an improper view of money. The other is a world of abundance. A grateful heart for what is given will help view the world with an abundance mindset. A view that there is more than enough is necessary for our children to have.
Give. A self-centered life is a miserable life. The more we get our minds off of our own wants and needs, and focus on others, we become happier. Giving is a great way to learn to lay down our wants and desires for the good of others. We must teach and show our kids to give of their time and money. To give is an important step in a fulfilling financial future. Start when they are young and it will be more natural.
Invest. Our kids need to learn to sacrifice their wants today for a brighter future tomorrow. Investing as early as possible will allow the time value of money to work. My father started teaching me investing so young that it is like a game. I have a lot of fun investing. If you start your kids early, they could get the same enjoyment out of it. Investing will lead to a life of freedom and the option to choose when and how to work.
Debt. We need to teach our kids the dangers and pitfalls of debt. Nothing takes the joy out of life more than a mountain of bills. Debt can limit choices. It puts chains and restrictions on life. In my own life, debt forced my wife to work after we had our first child when our desire was for her to stay at home. She is a stay-at-home mom now, however, it took sacrifice and time. Teach your kids to avoid the “easy” path of consumer debt.
Save. Instead of borrowing, we need to instill the concept of saving for what they want. Right now my daughter is saving for an American Girl doll. She is giving up little toys to get this doll. Starting our children with the habit of saving will save those years of pain. Satisfaction can come from discipline and a plan.
Spend. What good is a pile of money if you don’t spent it? Living like you are poor when you have money is silly. Don’t teach your kids an attitude of the fear of money. This is helped by teaching them to spend. Financial discipline should be fun. Discipline guides our money where to go, giving us more satisfaction and enjoyment than frivolous spending. Teach your kids to have fun while they spend earned money.
Perseverance. It is so easy to give up when we screw up, throwing our hands in the air while crying. Our kids, just like you and I, will screw up. We must teach our kids to get back up and try again. To persevere beyond what we think is possible, and no matter how many times we fail and fall down, we need to teach them to rise again. Perseverance is like a muscle. The more we use this muscle, the stronger it becomes. This can be the most valuable lesson we pass on to our kids. Start teaching this early and often so that your children will be over-comer’s.
These seven things don’t come naturally. They are crucial however to having a prosperous future. Teach your kids where you failed and what you have done right. Start as early as possible, and as often as possible. You do not have to be perfect to teach your kids.
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If you don’t, the world that has gone mad will teach them. They will learn through the pain of personal choice. Commercials will show them what they should want. Credit card companies will show your kids how easy it is. All the while robbing them of a life free of financial bondage. Sow into your kids a financial future of hope.
What are you teaching your children about money?
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Originally appeared at The Good Men Project
More from GMP:
33 Ridiculous Things You Had No Idea You Had to Teach Your Kids
Is a Picture Worth a Thousand Words… Or Dollars?
Photo: Flickr/ Carissa Rogers