As we are all experiencing rising prices with our monthly expenses, now could be a good time to talk to your kids about money and good financial habits.
One great way to teach your children about budgeting and saving is having conversations about the differences with priorities and spending your money on Needs versus Wants. Talking about what inflation is can also be helpful but they also need to understand that periods like we are going through now don’t last forever. This means staying calm and keeping to healthy spending habits now can set all of us up for success down the road when the world is in a better place.
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Kids of all ages pick up a lot of hidden attitudes around money when they are very young by observing and hearing their parents. This will shape your children’s relationship with money going forward. Children can be witnessing a lot of stressful comments and conversations now about the rising costs of food, clothing and pretty much everything else. I know from my own childhood, I watched my mother experience a lot of stress around money. This led her to make some decisions that might have saved money in the short term but were not good decisions for her long term situation. A lot of those decisions usually had to do with not spending small amounts of money to maintain her car, her health or some other types of repairs which ended up creating a bigger problem down the road.
The more you can teach your children the benefits of thinking long term and creating the habits of maintaining their health and other belongings, the more you can help your kids build a great life for themselves. Another great topic for your kids is talking about skills they can learn that are both fun and save money. Skills like sewing and woodworking can be both fun and great money savers all at the same time. I have enjoyed doing projects with my family that involve refurbishing furniture bought at a big discount and all it needed was sanding and repainting. It was a great project to work on with my husband and step-daughter and she loved it for her room when it was done.
Times like these can also be a great opportunity to speak to your children about what they see on social media. There is a lot of debate on how social media is impacting the self-esteem of children everywhere. This is actually a great reminder for adults too! We all know that what you see on social media as well as what you see with your colleagues and peers may not represent the whole truth. Many people feel the need to impress others and go into credit card debt to purchase expensive brands for what is usually a short lived rush. Talking with your family about the fact that their self-worth comes from who they are as a person and their kindness and values, not what they own, can set your children up for a happy and well balanced life.
Here are a few ideas on how talking about what is happening in the world in a healthy and balanced way can get your kids set up for a healthy relationship with money.
- Talk about budgeting and saving in a positive way and discuss family values and priorities around how the family income gets used.
- Now can be an important time to discuss the bad properties of credit card debt and other high interest debt.
- This can also be a great time to talk about the many fun activities you can do together that don’t cost much money and create wonderful memories. Activities like parks, hiking, family game night, hiking, bike riding or other outdoor activities where you already have the equipment (which can often collect dust in your garage) can be great ways to have family time.
- Another great concept we can talk about with our kids is the difference between saving money in the bank and growing your money for the long term by investing.
The primary place children learn about money and finances is from their parents. The basic concepts of money, budgeting and investing aren’t even taught in High School usually, let alone college unless you are a finance major. If we can all use these tough times as an opportunity to have uncomfortable conversations we may be able to have something good develop from it.
As always, the more calm and long term thinking you are, the more your children will grow up with a healthy sense of their own relationship with money and other people as well.
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Bye For Now
Debra
Debra Ohstrom, CFA
Founder | DebraOhstrom.com
DEBRA OHSTROM
Debra Ohstrom, CFA is a financial educator and coach focused on empowering women to be confident and in control of their financial wellbeing. Debra has worked in the financial industry for over 25 years and has an MBA in Finance and the Chartered Financial Analyst designation. She has built an on line course and coaching program to educate women to understand money and investing with ease so they can achieve the life they desire.
Debra has spent a majority of her career working at large firms such as Merrill Lynch, Morgan Stanley and Citi Private Bank in New York City and traveling the country working with clients. She grew up on Long island, NY and now lives in Charleston SC with her husband.
Being raised by a single mom, Debra watched her mother struggle with money and saw how that impacted other parts of her mother’s life whether it was her health or her relationships. This motivated
Debra to become a financial expert and Debra is on a mission to demystify money and long-term investing so that all women have the knowledge they need to make good decisions for their financial
health and achieve a secure financial future.
