You are much more likely to be successful at reaching your goal when you’re not doing it alone. That’s why we talked about the importance of having a buddy or accountability partner. Of course, getting your spouse on-board with your financial goal is a huge win! Sometimes, however, we overlook the benefit of involving our kids in finances. In fact, in many cases we do our children a disservice by not involving them more in finances.
Sure, there are lots of arguments for not involving children in finances. We don’t want to burden our children with adult problems like credit card debt or not enough income. We may think it’s none of their business. We may be embarrassed to let them see our mistakes and shortcomings. We may just not have the patience to explain it all.
Bringing our kids into the process regarding finances has benefits, both long- and short-term. Kids learn through example– actions speak louder than words. If our kids follow our example (i.e. spending frivolously or living on loans) without knowing the big picture (i.e. drowning in debt), they’re going to have to learn the hard way. Being wise with money is a learned skill, which unfortunately isn’t taught in schools. If they don’t learn from their parents, children will have to rely on their own experience to teach them. Kids who learn to be smart about money from a young age will have a real advantage when it comes to the “real world.”
In my opinion, the benefits of involving kids in finances outweigh the drawbacks. Keep in mind, that what we share with our kids should be appropriate for their age. We don’t need to reveal every last detail. We also don’t need to be perfect in order to be effective teachers. It’s okay for them to know that we make mistakes too.
Getting Kids Involved in the Family Goal
Whether your goal is to get out of debt, to pay off your house, or to save for a family vacation, your kids can be a part of it! Involving kids in your family’s financial goals can help to unify your family. Talk to them about your goal and invite them to be on your team. Your excitement and enthusiasm (or negativity and pessimism) will be contagious! Tell them what changes you are making to reach the goal and let them know how they can contribute.
Here are a few do’s and don’ts
- Let them know how they will benefit from the family goal.
- Tell them why you need their help.
- Explain specific ways that they can help.
- Notice and appreciate their efforts.
- Make it fun, like a game or a challenge!
- Involve them in celebrating milestones and other successes.
- Don’t overwhelm them. Take their age and life experience into consideration.
- Don’t give them more information that they need. Numbers and details can be burdensome for some kids.
- Don’t make them feel guilty. Guilt is not a good or sustainable motivator.
Motivation to Make Sacrifices
Making changes to the way you spend money affects your kids. Maybe your kids are used to buying lunch at school and have to adjust to packing their own lunches. Maybe they are used to having fast food after soccer practice and will need to get used to waiting until they’re home for dinner. If you cut cable to lower your bills, you can bet that your kids will notice! Any way you slice it, your kids are going to be affected by your choices to become more frugal.
Without knowing the reasons behind your frugal changes, kids are likely to become frustrated by the new habits you are trying to form. They may even be disgruntled enough to thwart your plan to change. On the other hand, when your kids are involved in the family goal, they are motivated to make the necessary changes. They realize that you aren’t just trying to make their lives hard, but you’re actually trying to improve their lives. Goals help to motivate all family members.
Keeping You Honest
Kids make great accountability partners— almost too good sometimes! A few months ago we spent the entire day out and about. I had brought food with us for lunch, but I hadn’t planned any food for dinner. We were an hour from home and I didn’t have any plans at home either. I made the decisions to use the rest of the month’s budgeted “fun money” to go through a drive through for dinner. Instead of being excited about this very rare occurrence, my kids were confused and disappointed. “Why are we buying food here? Don’t we have food at home? I thought we were saving our money for Daddy’s law school?” If I hadn’t already ordered, I would have just gone home. The kids were trying to keep me on track!
Sharing in the Success
As part of the team, your kids will be able to share in the success of your goal, both in the end and along the way. They will feel that their sacrifices matter and are making a difference. Kids (and adults) are more likely to appreciate something that they worked hard to earn. By taking an active part in working toward the family goal, kids will learn the power and value of goal-setting. On top of that, they will be increasing their own financial skills and self-discipline, which will lead to future success on their own.
Think about how you can involve your children in your goal. What contributions can they make to be part of the team? How can you get them excited about your goal? Now go for it!
- What have you done (or seen done) to involve kids in family finances?
- How have you helped your kids get motivated about financial goals?
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