Kids and Money

A few years ago, while visiting the home of a friend, I noticed a book on her kitchen counter about raising kids without a sense of entitlement.

It made sense to me that this friend would have such a book. She and her husband, both professionals, are doing well financially. I didn’t think to copy down the name of the book, because I didn’t think I’d ever find myself in their situation. I was still suffering the financial constraints of the newly divorced. “My kids know we operate on a budget,” I said to myself – and by budget, I meant we generally were living paycheck to paycheck. It never dawned on me that my kids would see our situation as anything other than a struggle.

Fast forward five years. My oldest child, my 14-year-old daughter, is now a teen. Like many teens, her tastes exceed my budget. She wants to wear designer jeans. Shopping is a hobby or a fun pastime. She also loves good food (no Mickey Ds for this kid), concerts and Broadway shows.

Nothing wrong with any of that. I raised her to have good taste. Still, there are practical limits to how much of this I can fund.

I tried giving her an allowance, but the concept of saving eluded her. She would spend her allowance and then ask (demand) more for “hanging out.” Paying for chores didn’t make sense – washing dishes and doing the laundry are obligations to be shared by the members of the household, not something one does for remuneration.

I told my daughter to start babysitting for extra money. She did, a few times, but never actively pursued it. When I told her to start tutoring younger kids or find something else to earn some pocket money, she cried and said, “I don’t know how to do anything!”

I sat down with her and went over the household budget with her to the nearest dollar, showing her how my bi-monthly paychecks are spent. She nodded, wide-eyed, but the effect wore off the next time she wanted something and I refused to give it to her.

I can’t do the money battles anymore. Her raging sense of entitlement and utter lack of responsibility and accountability infuriate me. Lecturing doesn’t work. So to teach her some valuable lessons about money, I’ve decided to enroll her in World of Money, a one-week summer program for kids 9-17. World of Money introduces basic financial concepts to kids and helps them begin to understand what spending, saving and investing really mean.

In one week, my daughter will learn as much as possible about banks, interest, the stock and other financial markets, the role of the U.S. Treasury, budgets, and other basic money concepts.

I hope the program has a lasting impact on her. It’s important for all children to learn about how money REALLY works, but I think it is especially important for black children to be exposed to this information. Our kids don’t see us often enough engaged in the acts of saving, investing, budgeting and paying bills. And while I recognize the importance of leading by example, those at-home lessons need a boost from someone who isn’t Mom saying “no” all the the time.

While I may not have the means of my friend’s family, I am fortunate to have moved beyond living paycheck, to taking one or two significant family vacations per year. My kids’ sense of entitlement is out of control, and I need to reign it in this summer. I am going to ask my friend for the name of the book she bought for her family years ago, but I am also open to other suggestions. If any of you CocoaMamas readers have thoughts or recommendations about how to teach children, especially teenagers, some valuable and worthwhile lessons about money, please share.

9 thoughts on “Kids and Money

  1. THIS IS A SUPERB POST! and resonates on every front. I did not come from affluence and my siblings and I rose through the mire through my parents’ abiding belief in education opening doors – not money.

    I too see my daughters and friends’ daughters (they seem to be worse than boys for some reason?) understanding the lessons for a short time, but then thinking nothing of requesting an item which should be aspirational – ie: save up for it, work for it or shut up about it since the monthly obligations are already committed to.

    The financial aspect I do nag about (and must find another way) is LEARN HOW TO SAVE MONEY. Even if it is only 0.5% – every time some money comes your way save a little of it. It is yet to happen in any meaningful way.

    I do understand that youthful urge to have everything. Hell, we had the urge, but there the urge stayed. We in no way had any sense of entitlement the way I see today and which you aptly describe.

    However, as I have counselled other parents (myself included) a ‘no’ will not kill them and, in fact, will go further in teaching and modelling than giving in to the next thing they have to have if they are not to expire.

    Beautifully honest post. HMSx

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  2. Wow, that sounds like an awesome program. I hope it’s still around when my kids are old enough to participate. My credit union offers young savers accounts that only require a $5 deposit to open. If your kids don’t already have bank accounts, maybe that can help.

    Even though mine are only 7 and almost 4, my husband and I have been trying to curb the entitlement mentality too. The kids earn bingo chips for good behavior and helping, and use the chips to buy tv and computer time and snacks. We tell them that those things are privileges, not entitlements. And that’s the language we use, no baby talk.

    Last year, my daughter was only allowed to keep birthday gifts from family. All other gifts, which we told guests in advance, were packed up and delivered in person by me and my daughter to Children’s Hospital. I involve them in volunteer work and donations of books, clothes and food so that they learn not to take things for granted.

    Good luck to you!

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  3. My mom used a hands on approach to financial literacy. As a young teen, it was my job to grocery shop for the family. She would write a check for a certain amount, and that was how I learned to start budgeting.

    We started talking to our kids about money at about 5 years old. My kids have watched me pay bills online. They know the difference between debit cards and credit cards. They know that checks are linked to bank accounts. They understand how and why people are paid for work. Etc. Everyone receives an allowance not tied to chores (dollar amount equal to their age) and is expected to save a third, donate a third, and spend a third. My DD1 is more thrifty and a result, usually has more money for special events. My older son (10) has an expensive hobby (r/c cars) and so he is always spending money on his cars. When he is short on cash for parts, he knows he can earn money by doing tasks above and beyond his chores.

    I’m so happy to see this post here as I don’t think it’s a subject that is talked about enough.

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  4. I loved the honesty of this post and I applaud you for working really hard to give your daughter an understanding of money management through your own efforts and now the summer program.

    I have a feeling, though, that the real problem is not about money skills, but more about your daughter’s mindset – as you say, “her raging sense of entitlement and utter lack of responsibility and entitlement.” I don’t think the summer program will really help with that so it’s great that you are looking for other resources too.

    It will still need you to continue standing firm and saying No which is exhausting. Kids really know which buttons to push and are so persistent in finding ways to get what they want. Changing this kind of mindset won’t happen overnight. Your daughter is lucky to have you as a Mom – something she won’t realize as she fights you over the latest request, but will appreciate later in life.

    Good luck!

    Suzanne

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  5. My mom is a physician, so growing up, we knew that she made a lot of money. We lived in a big house, and suspected that my mom had a lot of money, but she acted broke when we would ask her for things. She would tell us upfront how much she was willing to pay for things, like back-to-school shopping, homecoming, a class trip, etc. Period. If we wanted more, we had to figure something out on our own. As a result, all 5 of us kids got jobs at ages 14 or 15, because we knew that asking mom was out of the question. Are you open to letting your child get a job? P.S. when we got the jobs, the little trickle of money we got before dried up to $0, unless it was a birthday or Christmas.

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  6. Great post. I worry about this as my kids get older. I wasn’t taught to save or handle money well, and my current financial state shows it. I am working very hard now to teach myself about money management, starting with getting out of debt.

    For my kids, I plan to use a lesson I learned from the Cosby show. Vanessa was one day lamenting about being rich. Phil and Claire cut her off, telling her that they might be rich, but she had nothing. When my kids ask me for things in the stores, I often ask them if they have any money. The answer is always no (they are only 5 and 3), so that handles that. As they get older, I think we will do the 1/3 spend, 1/3 save, 1/3 donate.

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