Finances and children

[shoney]

I do not discuss my personal finances, bank accounts, income, bills, loans etc. with my children. It is my personal business.

If we talk about how much something costs with our teens, it is in relation to a minimum wage job because that is around the amount they will earn at first. It will take you x hours to earn y and the item you want costs xxxx. if they talk about something in the future we may say in order to have that or that lifestyle, you will need to earn a certain amount.

 

[Night Huntress]

Growing up my parents never discussed ANY details of finances with us. I discuss most of the finances with my children. DS is almost 15 and DD is almost 11. I am a single mom and have been for 10yrs. A few years ago I went through a very rough patch and was going to lose my house and I was struggling to just put food on the table. The kids knew things were tight but I didn't explain the severity. I didn't want to stress them out. Like one poster said "if there is a problem they really can't do anything about, then you probably shouldn't involve them in it". My neighbors were kind enough and helped me out of my rough patch. I vowed then I was never going to be in that situation again if I could help it. I have busted my butt at work for the promotions I received and even occasionally work a second job to pay for things we want rather then need (Like DISNEY!!!). My kid's don't know what I make (although DS is determined to find out). They do know what our bills cost each month. So when DS complains his internet isn't fast enough...well....we pay X amount for the bill, where would you like to cut in other expenses so we can afford faster internet? DS - you were in a hurry and cut the wire on the central air unit weed eating. It cost X amount to fix. How should we come up with the money to fix it? They complain the house is too warm @ 72 degrees. But who pays the bill? So I inform them of all the bills so they can better understand that it isn't free to live the way we do. If they can come up with a better alternative or are willing to cut something out in order to get something different then the more power to them. This completely cut out all the asking for stuff all the time. Anything big they want or too expensive...they offer to work to save for it and save birthday and christmas money. Does this stress my kids out? It might for my DD but my DS??? I really doubt it. I think it's more important for him to know now then before since he will be driving before long.

 

[chris31997]

We do talk about money with our kids. Not only that they have to listen to Dave Ramsey, which thankfully they do not mind.

Our kids get a pay check from us, and we talk about it tithing, saving, and spending. The younger one(10) clears his spending with us. He asks to buy things and we limit what he can buy due to his attitude more than anything. The older(19) is on her own but we still check in with her about her tithing, spending and saving.

Our kids see us sit down each month doing a budget. And they know we are saving for retirement, house(currently military and waiting for retirement), DS collage, and their own UTMA. They also see us using cash.

We talk bills and investments and cost with the kids ALL the time. But it usually is when the situation comes up like my ac is on and you left the door open Or when their UTMA statements come in. We have also told our kids what we will pay for and what they are on the hook for.

 

[kymom99]

My son knows in a general way about our finances. He has gone to private schools since first grade. Many of the other kids' families make a lot more than we do. Also, we now live in an old house in a newer, upscale neighborhood, so the neighbors have lots of toys. He knows we don't have what they have but we work hard to have the best we can. My husband lost his job in 2009. We sat our son down and told him, but ensured him that I still had my job and we would be ok. At the time we lived in a very small house in a so so neighborhood and we were ok on one salary, but we would have to make some sacrifices. For example, we dropped our YMCA membership. I'm sure he worried about it, but it didn't make sense to shelter him from it. I have never hesitated to tell him something was too expensive or we couldn't afford something. I also would sometimes fuss at him for buying a bottled water for $1 when he could take one from home for pennies. Ha ha!

My son inherited my dad's old car when he got his license. He didn't have to have a car, because the bus stops right in front of our house, but it was convenient for us for him to have one. He has some days with no bus service and has practices in the mornings when school is not in session. He is perfectly happy with his car. His friends all have older cars too. If he wants to upgrade he will have to buy it himself. He knows how much his insurance is and he knows it will go up if he does anything stupid. He paid for some of it for a few months but I gave him a pass recently because he had to take a leave of absence from work due to an activity he participated in.

He takes accounting in high school now and will also take personal finance this year. I think he will see the reasons why we made the decisions we have made over the years.

 

[HM]

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Kind of on this topic, I am constantly amazed at the HGTV shows that feature seemly young couples buying these expensive homes early in their careers, if not right out of school. Saying their house MUST have granite and things like that....and they're first time homebuyers. They seemed to expect to move into a home on par with the one their parents own now, not into what we used to know as a "starter home".....

We are in our third home, working up from a two bed/one bath at 998 sq feet to our current 3500 sq ft house with five bedrooms. We were some of the first people to build a house in our neighborhood and expected to have people with kid in middle and high school move in like us at the size and price point. We were and still are shocked at how many of our new neighbors were first time home buyers without children.

 

[QVCshopper]

Yes, I talk about finance with my three kids, ages 4 to 11. In this day and age, I think you really should because there are so many people that are heavily in debt. We talk about how much our house cost, cars cost, vacation costs. We talk about how much I made at my first job at 14 and how much I make now. We talk about how much we have in savings, and what it's slotted for, like their college education and our retirement. And, we talk about day to day things, like why we use coupons and shop at certain stores.

But, my husband and I never ever fight about money. That's where I think the trouble comes in. My parents weren't well off, and constantly fought, with screaming and yelling all the time. That stuff really makes a negative impact.

 

[dadtoagirl03]

My DD doesn't know specifics of our earnings/expense, but she's had a checking account since she was 7 with a debit card. We take her to the bank to deposit birthday/Christmas etc... money into the account and she is responsible to reconcile what she spends on the card. We have many conversations on how you budget, use credit to your advantage, and the pitfalls of not doing either correctly.

 

[Sagginit]

My parents never really talked to me about money until I was a teen. They were divorced and they handled finances completely differently. When I was younger (I would say until I was 12-13) I never knew anything about finances and thought in fact we did fairly well. When I became an older teen I realized my father was somewhat cheap to afford what he wanted in life and my mother was a spendthrift who lived pay check to pay check at times. My father lost his job right around when I was graduating high school and it was a dramatic shift in my life as the money was suddenly gone. My mother had no savings to rely on and my father stopped paying the mortgage on the house we lived in. Long story short I found out much of my childhood assumptions about our status and wealth was smoke and mirrors. I graduated college with a lot of student loans and was in for another shock when I couldn't find a good paying job right away. Ironically I came on the boards planning my first WDW trip (it was the first year I had gotten a salaried job and under my mother's influence it made perfect sense to put a month's worth of pay towards a vacation) and started learning personal finance. I took out several books from the library on budgeting and started snowballing my student loans. I am in much better shape but feel like if I had handled money better from the time I graduated college I could have a lot more in the bank right now.

I honestly wish I had been somewhat educated at a younger age and that my parents had been more financially stable. As a teen they started talking about finances but only in the sense of I was told they couldn't afford things, which was a shock as I had always had these things growing up and didn't think we were poor by any means. I would say the key is they should know enough to learn how to handle their own finances but not enough it becomes an emotional burden or they feel like a burden to you. Also I think when you are young you are more inclined to take risks, so when you get to college or right out of college a lot of your peers are spending freely. You will have that nagging conscious telling you not to blow money like your friends if you were raised with a good sense of finances. That can feel like stress but I think its stress you need. Later on you will have freedom that your peers won't as they made bad decisions early on (such as that million dollar "starter" home). I think every kid feels like their parents nag them about something. Finances I think are like sex-ed, the younger the more basic and less frequent the education you need. The older you get the more in detail it should be and the more frequent you need reminders about making good choices. Once you leave the home it's over and parents can just hope their children will make the right decisions on what they were taught.

 

[Eureka]

Growing up my parents never discussed ANY details of finances with us. I discuss most of the finances with my children. DS is almost 15 and DD is almost 11. I am a single mom and have been for 10yrs. A few years ago I went through a very rough patch and was going to lose my house and I was struggling to just put food on the table. The kids knew things were tight but I didn't explain the severity. I didn't want to stress them out. Like one poster said "if there is a problem they really can't do anything about, then you probably shouldn't involve them in it". My neighbors were kind enough and helped me out of my rough patch. I vowed then I was never going to be in that situation again if I could help it. I have busted my butt at work for the promotions I received and even occasionally work a second job to pay for things we want rather then need (Like DISNEY!!!). My kid's don't know what I make (although DS is determined to find out). They do know what our bills cost each month. So when DS complains his internet isn't fast enough...well....we pay X amount for the bill, where would you like to cut in other expenses so we can afford faster internet? DS - you were in a hurry and cut the wire on the central air unit weed eating. It cost X amount to fix. How should we come up with the money to fix it? They complain the house is too warm @ 72 degrees. But who pays the bill? So I inform them of all the bills so they can better understand that it isn't free to live the way we do. If they can come up with a better alternative or are willing to cut something out in order to get something different then the more power to them. This completely cut out all the asking for stuff all the time. Anything big they want or too expensive...they offer to work to save for it and save birthday and christmas money. Does this stress my kids out? It might for my DD but my DS??? I really doubt it. I think it's more important for him to know now then before since he will be driving before long.

So just curious, if you are very honest with them about how much things cost and that you'd need to cut spending in one area to allow for spending in another problem area, why won't you tell them what you make? DH and I have no problem telling the kids our incomes (especially bc I was just laid off and we've had to curb discretionary spending this summer) so they can fully understand (as much as teens can, without paying the bills themselves) the situation. We have also been clear about even with DH's income, we have much more than many others and it's not something for them to worry about. Again, not an accusation, just really wondering. Thanks.

 

[Night Huntress]

So just curious, if you are very honest with them about how much things cost and that you'd need to cut spending in one area to allow for spending in another problem area, why won't you tell them what you make? DH and I have no problem telling the kids our incomes (especially bc I was just laid off and we've had to curb discretionary spending this summer) so they can fully understand (as much as teens can, without paying the bills themselves) the situation. We have also been clear about even with DH's income, we have much more than many others and it's not something for them to worry about. Again, not an accusation, just really wondering. Thanks.

It's just personal preference. If I knew it would stay between us it would be one thing. I don't have the best relationship with my kid's dad and have absolutely no desire to let him know how much I make. I know my son would tell him. I just don't want my ex knowing if I'm struggling or if I'm doing well. (My son is always comparing us and I don't want to add to it). I could increase my bills by lowering the air, getting faster internet, etc. - I just don't want to pay more (that's why I try to explain to the kids about cutting out one thing for another). I like knowing I'm at a place now that I can actually put money into savings and being able to take a Disney trip this year. I didn't think you were accusing me- lol. I know it may seem weird to some for me to not tell them.

 

[Arielle22]

My DDs are 21 and 23. We have discussed finances over the years. At times, we explained that while we could afford what they wanted, we preferred to have that money for something else.

We opened savings accounts for them when they were young and every week they got an allowance. $2 went to savings, $1 went to church collection plate, $2 was spending money for the week and $2 they would save to buy something bigger (like a video game). The savings account was when I explained compound interest to them.

DD23 thanked me when she started college and she saw other students unable to understand simple finances. She is graduating after finishing two courses and going back to Disney for the internship program. I bought her Quicken software so she can track her finances. I explained it was best to start early so she could get a better picture of where her money went over the long term.

DH and I have been together since we were 18 and 20, married almost 31 years. We made financial mistakes but we have always contributed to our 401k. This is something else I explained to DDs. Start contributing early, even small amounts and historical data shows they will be better off than contributing more later in life.

 

[SC Minnie]

We don't talk about our personal finances with DD- how much we make or how much our bills are. What we've done is have the appropriate conversation at the appropriate time as she was starting to go through things. Like her first job and car-- how much was she actually going to bring home and what expenses she was actually going to have. That she should try to save something every paycheck and how to discern a want from a need--funny how few things are 'needs' when they are paying with their money.

When she wanted a smartphone-- we paid for her flip phone- we told her it was not a necessity and if she really wanted one she should have to pay the additional ~$30/month for it. She paid it every month then got her tax refund and just paid up for the year. She's been doing that ever since.

When DD was getting her first apartment we helped her figure up all her costs before signing anything. Setting a budget. It's amazing that all of the sudden she didn't 'need' cable. From the time she was a toddler she had helped us grocery shop so knows how to use coupons, price compare, look for sales, and use store discount programs.

 

[Eureka]

It's just personal preference. If I knew it would stay between us it would be one thing. I don't have the best relationship with my kid's dad and have absolutely no desire to let him know how much I make. I know my son would tell him. I just don't want my ex knowing if I'm struggling or if I'm doing well. (My son is always comparing us and I don't want to add to it). I could increase my bills by lowering the air, getting faster internet, etc. - I just don't want to pay more (that's why I try to explain to the kids about cutting out one thing for another). I like knowing I'm at a place now that I can actually put money into savings and being able to take a Disney trip this year. I didn't think you were accusing me- lol. I know it may seem weird to some for me to not tell them.

That makes perfect sense if you think it won't stay private. We didn't tell our boys things like that until they could really understand the idea that you don't tell your friends etc.

 

[aretha30]

We don't give our boys (13 and 8) specifics such as how much we make or exactly how much our bills are but they know that we have a budget and stick with it. We have taught them and will continue to teach them to leave within your means. We don't use credit cards, so they know we pay cash (use our debit card) and don't buy things we can't pay for. We go on vacation each year and they know it is part of our budget. If they want something they understand if it's not in our budget.

 

[tvguy]

I do not discuss my personal finances, bank accounts, income, bills, loans etc. with my children. It is my personal business.

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I hope you will reconsider that when your children hit 18. If something happens to you and you cannot care for yourself, or die, it is critical they know how much money is available and how to access it. Because my father was diagnosed with caner when I was 7 and passed away when I was 9, I was always informed about my mom's financial situation after my dad passed. And literally the day I turned 18 I was included on all accounts and property so that if something happened to my mom, I could pay her bills and oversea her health care. Fortunately, it was another 40 years before I had to step up, but I cannot tell you how helpful it was to be able to step up and pay my mom's bills the last year of her life, know what her wishes were. I think if you sit down with an estate planner, you might get a clearer picture of why your kids need to know.

 

[kymom99]

I'm not sure if my son knows what I make. I think he has an idea what our household income is from various times I have had to provide that info. However, I hesitate to give the breakdown because I make a lot more than my husband and I don't want to slight him. I do want to impress upon him what a college degree can get you at some point.

 

[melmel]

Not my kids yet (only 4 and 7), but when I was 16 my mom started teaching me to be an adult. I learned to drive, and part of that was learning to grocery shop properly (picking proper produce and meats, as well as unit prices, coupons, and brand vs store brand). I also started doing the bills, balancing the checkbook, writting out the checks and envelopes, and updating the budget. All with her supervising obviously, but it taught me how to budget and run a household, and also to better understand where the money went. It gave me very helpful skills but also great insight I'd of never gotten otherwise without moving out, and failing for myself. I fully intend to do the same when my boys each turn 16. I think it may be more valuable to them since nowadays they don't see a physical exchange of currency just swipe the magic card and boom things are handed to you.

 

[shoney]

I hope you will reconsider that when your children hit 18. If something happens to you and you cannot care for yourself, or die, it is critical they know how much money is available and how to access it. Because my father was diagnosed with caner when I was 7 and passed away when I was 9, I was always informed about my mom's financial situation after my dad passed. And literally the day I turned 18 I was included on all accounts and property so that if something happened to my mom, I could pay her bills and oversea her health care. Fortunately, it was another 40 years before I had to step up, but I cannot tell you how helpful it was to be able to step up and pay my mom's bills the last year of her life, know what her wishes were. I think if you sit down with an estate planner, you might get a clearer picture of why your kids need to know.

So sorry you lost your dad at such a young age. It sounds like your mom did what she was comfortable with and it worked for you.

There is no way I would consider putting my kids names on my stuff at age 18. I do not know anyone who has done this. I have no idea how much my parents or in-laws are worth, nor is it any of my business.
My kids will get what they get when my DH and I die. If one of us is to become ill, the other will deal with it. Maybe when I am in my later years, I will share more, but for right now, no.
Teaching about finances and responsibility can be done without sharing personal info.

 

[tvguy]

So sorry you lost your dad at such a young age. It sounds like your mom did what she was comfortable with and it worked for you.

There is no way I would consider putting my kids names on my stuff at age 18. I do not know anyone who has done this. I have no idea how much my parents or in-laws are worth, nor is it any of my business.
My kids will get what they get when my DH and I die. If one of us is to become ill, the other will deal with it. Maybe when I am in my later years, I will share more, but for right now, no.
Teaching about finances and responsibility can be done without sharing personal info.

With all due respect, I hope you take a little time to meet with an estate planner before your oldest turns 18. I think it is far far far more common than you think for people to share their financial situation with their kids set up Trusts and set things up so their children can manage their finances and care if they no longer can. You will also have some decisions to make regarding disclosing your finances to your children when they get ready for college and you had to deal with FAFSA.

 

[kymom99]

So sorry you lost your dad at such a young age. It sounds like your mom did what she was comfortable with and it worked for you.

There is no way I would consider putting my kids names on my stuff at age 18. I do not know anyone who has done this. I have no idea how much my parents or in-laws are worth, nor is it any of my business.
My kids will get what they get when my DH and I die. If one of us is to become ill, the other will deal with it. Maybe when I am in my later years, I will share more, but for right now, no.
Teaching about finances and responsibility can be done without sharing personal info.

Do you have someone designated to take care of your affairs if you both were to pass at the same time? Or become incapacitated?