Money Management for Children - Teach Your Children Well

Karrine Steffans - Confessions of a Video Vixen. That’s the author and name of one of the hottest books out on the circuit. Pretty catchy title, eh? The author is a 26 year-old, self proclaimed recovered addict of the sex, drugs and go-go dancing world of rap. The book, which was published in June, 2005 landed on the New York Times best seller list in no time. “Sex sells” as they say.

So why am I mentioning this book?

I had the pleasure of seeing an interview with the lovely Karrine Steffans, in which she casually threw out the fact that, she makes everyone who visits her boudoir give $1.00 to her son for his college education. Let me reiterate what I just mentioned here. She doesn’t have a cookie jar, with a message that says “please donate to my son’s college education”. She makes her visitors give him $1.00, whether they want to or not – it’s compulsory.

The interview prompted me to think about the monetary examples and expectations we set for our children and how our behavior may lead, our children to have bad money management habits.

We were all taught that people were more important than money, but how many times did we see our parents buy things that they wanted – not needed instead of giving that money to someone who really needed it? So did we grow up, really believing that people are always to be valued over money?

Do our children believe the same? Are they inclined to share their allowance with people, who are less fortunate or do they dream of buying video games, iPods and dolls with their money? Do they understand that money is earned and not a given right?

The way we view money when we are young, dictates the way we manage money when we are adults. Some adults feel entitled to buy and posses everything their hearts desire, whether they can afford them or not. The sense of entitlement extends to attiring in the best designer labels, dining in the best restaurants and taking exotic vacations at a moment’s notice.

We all deserve nice things. Life is sweet, but it is also challenging and we should eat, drink and be merry, whenever life affords the opportunity. But being in debt and being denied credit or squandering the opportunity to own a home is not a good thing. None of us want this for our children.

So what should we teach our children about money? Children should understand that:

  • Money in itself does not afford inner peace. Inner peace, being the feeling you get on the first break of spring, when you shed your winter wear and the air smells like the sweetest perfume you ever breathed or on a lazy summer day when you are sipping an cold iced-tea, staring off into the horizon with empty pleasant thoughts.· Money is more fun when you share it with someone you love and people who need it. We would all love to win a million dollars but all the money in the world would mean nothing without a healthy family. What would we do with all that money – buy hollow castles and take vacations by ourselves?

  • Money is best enjoyed, when it is dutifully and rightfully earned. Knowing that you worked hard for your money instills a sense of pride that cannot be replicated, if you got it for doing nothing.

  • Money will never buy you everything that you want and need. Most importantly, you will never have enough money. This is the nature of money. The guy who owns the mansion and the nice cars wants to own an airplane and the guy who owns the mansion, cars and airplane wants to own an island, etc.

    You have to learn to be happy with what you have. All of us know this and we struggle to accept it – it’s a journey. Our children should understand this and know that life is not about accumulating things.