Talking about money with your kids early is essential to help them avoid financial woes in the future. However, there are some things that children (especially at tween and teenage) are not willing to deal with and frankly don’t need to know. Here are 7 Things Parents Should Not Tell Children about Money and What to Tell Instead:
1. How Much Your Salary is
There is no need to tell your kids the exact number of how much you earn.
Instead:
Tell your child the average income of a family in your country, and tell him where your family is compared to that. Help them understand that not all families have the same amount of money.
2. Who Makes More Money in the Family
Children may confuse higher salaries with larger contributions to the family, so you should not tell them whether mom or dad earns more than the other. Especially if either of you is a full-time mom/dad, you should tell your children the great value of this.
Instead:
Make the children understand “Our whole family is a team, we all work to contribute to the family!”
3️. Your Savings, Investments, or Life Insurance Fund
Retirement funds, savings, investments, life insurance… are your business. They don’t need to know, and they shouldn’t know either. It is a big picture that they might not understand when they are too young. They also can become dependent if they know their parents have a large sum of money.
Instead:
Share with them your family’s financial goals, which they can contribute to achieving. For example, “Can you help me to take care of your younger sister? We will save the cost of hiring a babysitter, so our family can go on a long trip at the end of the year. Sound fun!”
4. The Money Habit of People They Know
They don’t need to know your brother (aka their uncle) has owed you $10.000 for several years. Or you shouldn’t tell them things like Aunt Lisa is a stingy person.
Don’t make judgments or tell stories related to money about your family members or even friends in front of your children. Because doing so will make children have prejudices and aversions to other people.
Instead:
If you’re going to teach your kids a lesson about money, remember to change the names of the characters!
A better way, just share good examples of sound judgment about money. For example, your friends have decided to give up their luxury Christmas gifts to donate to an animal aid organization.
5. How Much You Pay the Babysitter/ Nanny/ Tutor
Doing so will strip the authority of who are on your behalf over your children, for which you are paying!
Instead:
You can tell them that nanny and tutor are also common jobs but don’t mention the exact number of how much you paid. Let them develop a natural fondness for those who teach and take care of them.
6️. Prices of the Gifts
The kids, or anyone else, will lose their joy if you mention the cost of the gifts you give them. But children will pay more attention to the difference in price if any.
Instead:
Let’s talk about the value that the gift will bring and the meaning of each gift. Let them understand that the value of the gift is not in the price.
7️. Your Worry about The Expenses for Their Education
The children need to be encouraged to learn. Avoid talking about expenses in a negative way like going to college or studying abroad is very expensive and how hard you have to work to make ends meet. They may conclude that the cost of their education is a huge burden that they don’t want you to bear.
Instead:
Let this be the effort of both parents and children, not simply that you have to pay for this. It is clear that when we invest in our children, we also benefit from their financial independence in the future.
