Finances and children

[panfan2507]

I am just wondering if any of you would share how much you get your children " involved" with the household finances and to what extent?

My college age son basically just had a complete meltdown telling me that I have been stressing him out about money and finances his whole life. I believe I have been up to this point educating him on the way of the world.

In general , my children have not been required to pay their own way with pretty much anything. We take care of cell phones, car insurance etc etc.

We go on disney trips each year. In general they do know how much things cost and the strain to the budget of the household if there is one.

How much information is too much. ? My boys are 15 and 19 , so they are not little

Any insight or sharing is appreciated

 

[verleniahall]

i have always been involved (as much as I needed to know) in regards to finances

As for how much is too much? I think that depends on teh family and if there are STRICT budgets involved

 

[barkley]

my kids (currently 19 and almost 22) have never been privy to what our income was/is BUT they were aware that we had/have a household budget that drives our spending decisions.

when they were younger they knew that the reason we didn't constantly do allot of the stuff their friends/classmates did routinely (movies every weekend, going to every carnival/fair that came to town....) was because we earmarked that money for bigger vacations. in the short term they might have been disappointed but when we would do a Disney trip or cruise we would remind them of how we were only able to do it by minimizing the other stuff, and they saw/learned the value. they got a small allowance that was to cover the items that allot of their friends simply saw their parents pay out of pocket for like treats and movie/game rentals (so they knew exactly how much these items cost).

one of the best learning situations for my kids came out of negative situations in our family. both dh and I worked outside the home all the kid's lives until I became totally and permanently disabled at age 42. there were major changes to our household budget of course BUT it wasn't to the extent that the kids every really experienced anything differently. a handful of years later dh was in the same boat but again the kids didn't see a huge change in lifestyle (no more big vacations as frequently, less eating out was about it). we talked to the kids back then and explained what was going on-but they were still fairly young so it was just explaining that mom/dad would no longer be going to work, we would need to watch our budget more closely BUT because we had always budgeted we were going to be fine with the pensions we would receive.

the BIG learning came with the recession-the kids saw their friends have DRAMATIC changes in their lifestyles w/parental job losses. the first thing to go was private school, then it was often followed up by the family home and many of their possessions. as a teen observing this dd asked how it was that our household had continued to maintain itself, she and her db had been able to continue in private school while her friend's households were being destroyed. this opened the door for honest discussions on budgeting, working towards being debt free, saving and making hard financial choices.

as far as covering the kid's expenses-when dd got her license at just shy of 19 we covered her insurance for a year, and pointed out to her how her grades impacted her rate (had the agent do 2 quotes)-after a year she had to pay for it. with the cell phone we paid for a year as well-then it was on her (and it's amazing how they can do without certain plan options when they have to pay out of pocket).

I work hand in hand w/dd on her budget. when she started college and we saw what her financial aid/scholarships/work income were I encouraged her to do both a monthly and a yearly budget. we look to what she will have over the course of a year and then do a monthly budget so she knows what she can afford but also what she CAN reasonably get by on in order to save. doing this for her first couple of years of college has enabled her to save enough that she was recently able to move into her own place at a much higher cost than just her budget could afford her normally (she saved allot by living with a pile of roommates initially). it's been rewarding to hear her talk about spending decisions-and her opinions on some her friends make (like opting to get a pet which landlords for college housing around here not only charge a high deposit for but also increase the monthly rent on-she will say 'they complain that they can't afford their share of the utility bill, have to go to the food bank for groceries or that they can't afford to put any gas in their tank until they get paid in a couple of weeks-if they can't afford to support themselves WHY ARE THEY BRINGING A PET INTO THE MIX????'). sure she makes purchasing choices I don't agree with but she seems to have a decent grasp of staying within her budget (or at least covering all the basic bills and having a full pantry/fridge/freezer if she blows the bulk of her monthly grocery budget on video games).

dd complains at times about the stress she feels on finances (mostly me reminding her about them) but she also recently thanked dh and I for working with her on them. she shared that the stress she feels at times is nowhere near what she sees her friends go through b/c 'they only budget either paycheck to paycheck or financial aide disbursement to financial aide disbursement, and they've usually already spent their money before it comes in'.

 

[PlutoPony]

IMO at this age it's tough to put your family's financial situation in the proper context. The amount of $ that's coming in to your household - after many years of moving up career ladders and learning sometimes painful financial lessons - is likely beyond what he can aspire to coming out of university. He may be starting to question just how he's going to live a comfortable lifestyle, one that he's become accustomed to, on a starting salary. My son is a senior in college now and is starting to talk about where he can afford to live, will he need a roommate, and things like that.

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".....

 

[kamik86]

I get stressed about finances pretty often. DH doesn't. when we first started living together and I managed the budget he never understood why I would be uspet if we messed up and I coun't fully pay off the credit card (which we used for rewards) each month.

DH never thought it was an issue. But his parents had maxed out cards he occasionally came home to the TV or lights being off because they couldn't pay it after getting a shut off notice until the next pay check etc etc.

DH started understanding when many of his friends were having times they couldn't really afford much for food or had to go without a car because they couldn't afford repairs. Now he just knows to go with me on budget things and if I say we have to cut back because we are slipping in the wrong direction we cut back.


Really I should stress out less (seriously we have plenty of money for needs and wants, most of the time those are just little budget slips or times where I saved a bunch and then freaked because it all got used at once for the thing I saved for). DH should probably care a bit more... we even out lol

 

[KarenAylwood]

My child is 3 so... yeah I don't involve him right now other than to talk about how we have to buy things at the store ("we pay this nice lady so that we can take these things home with us") and I don't ever buy him anything on a whim unless we're set out to buy him something like shoes or something like that. He doesn't get gifts except on holidays and birthdays and he will get little things every now and then that I pick up somewhere but I make it clear that he gets these things for being good, or whatever it is.

My point in sharing that even though I know your kids are WAY beyond that stage is that we are going forward by teaching by example and being up front with our kid(s). My parents raised me to be financially responsible but I can't remember a time when they harped on me about anything or flat out shared information about the household budget. When we'd go out shopping together my mom would reiterate that she didn't purchase "X" because she didn't really need it, or because it wasn't on sale. We went shopping because we needed something specific- not just to shop. When I wanted something outside of a holiday/birthday then I had to pay for it with my allowance. I could only get something nice if I saved for a while, or did extra things around the house, etc. They always lead by example.

During my time growing up, my dad lost his job, started his own business and the grew that business into something lucrative. I wasn't privy to when we had financial problems or when we had a lot of money coming in. It wasn't until I was an adult, years into being on my own that my parents shared even a small glimpse into what they have now. As an adult we still openly talk about money and what I can and can't afford. They live almost the same way they did when they were in financial trouble (except now go on more vacations)- they are smart with money and try not to waste it. That was just life growing up.

My parents covered my expenses - gas, insurance, etc until I was out of college and always encouraged good grades and getting in to a good college. They believed this help to set you up for financial stability later in life (which it has proven to). The second I graduated from undergrad, I was expected to pay my way and I did happily.

 

[Gr8t Fan]

Our kids are 19, 17, 14 and 8. DH and I prepare a written budget every year and we talk about it with the kids. We also show it to them and have done so since they were very young (although most times it's like pulling teeth to engage them in the discussion). We are on a strict budget because we're a one income family by choice, so we want them to know where our money goes and what our priorities are. We also want them to see that it's possible to live on a modest income and still have a home and take family vacations, but sacrifices have to be made in other areas, especially recreational shopping and going out to eat. 2 of our 4 kids are pretty thrifty, 1 is a spendthrift and the jury is still out on our youngest.

 

[mistysue]

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".....

I'm right with you- my favorite is when it's like a waitress at some little diner with somebody just finishing school and they are looking at $800K+ houses sticking their noses up... their mortgage is going to be more than they make? Did one of them inherit millions just before the show or something?

Back to OP's topic-
My kids are 13, 7 and 5 (need to update my signature...)
Their involvement with the finances at this point is mostly asking for things at the store and responding with options of what we could do with that same money.
They ask about how much our house, car, my shampoo, etc. all costs and we tell them. When they ask how much we make I do tell them and explain all the taxes that come out. When they ask about the house I include a small talk about mortgage interest, insurance, taxes, lawncare, so they get that sometimes a price tag is not the whole price. I tell them anything they ask and have made my budget spreadsheet available to them but don't really force them to hear about it unless they ask. The 13 and 7 year olds ask and will volunteer that something is too expensive if there is something else they would rather the money went toward. I get called out on buying myself things "Mom can't you wait for it to go on sale? Don't you want to go back to Disney?" My 5 year old is less receptive (even for how the other two were at his age) if you mention money to him he just gives up and puts things back unless it's junk food.
When DD wanted a phone we went over the cost of service, costs for data use, monthly phone cost and how you are now tethered to a bill unless you pay a fee rather than just the phone price itself. She has some friends who come from very low income households so she seems to have grown to appreciate the discussion and realize that you have to both work within your means and protect what you have in order to get good use of your money.

 

[TwoMisfits]

My kids have been taught to always assume we are poor...so they know when mom/dad splurge on them, they are splurges. Are we poor? No. But neither can we ever keep up with the Jones, and my kids know that. So, they know mom splurges for holidays and birthdays, and every so often on vacation...and that's it. No one ever asks to be bought something in stores - instead, they know to ask for it to be put on Xmas/birthday lists (and depending on the kid, 95% of these things are never being bought b/c they are fleeting interests.
My kids also know we are paying 4 years in state tuition, no board for college...and they won't get cell phones until I have one with data (right now, I have an emergency flip phone) or they pay for it themselves...they know it's not cheap. They also know they won't get cars, unless they get college paid for or they buy it themselves.
Now, that being said, I fully plan on having them at home until 26 (unless they get jobs elsewhere) and will only charge "rent" I save for their future homes. They will pay their extras (car, phone, etc), but I'll pay to keep them healthy and with a roof on their head til they get really into the workforce and get started in life. Now, I didn't ever have that b/c I did get a job far away (but all my other siblings did), but times (and housing markets) change and I don't want them ignoring their health or safety to have fun, especially since intro salaries have not risen. But, I will launch them by 26, if not before. If they are ready at 22 (or even 18), I won't stop them...

 

[mommajo143]

My parents never talked to us about a budget per se but we knew we didn't have a lot extra. They were very clear with us all my years growing up that we paid cash for everything (no credit cards).

I didn't know how poor we were until I was an adult, but even so my parents were able to pay my tuition for me to get my undergraduate degree & covered my insurance on the hand me down truck I was given when I went away to grad school; they even managed to put a little $ each month in my bank acct for gas & groceries. I think each family is different but to me specifics about $ are adult issues... Like I said I never knew we were poor & how much my parents did without...I never worried because my parents made sure we had everything we needed & I guess that's where they educated us - differentiating between wants & needs.

 

[Eureka]

I am just wondering if any of you would share how much you get your children " involved" with the household finances and to what extent?

My college age son basically just had a complete meltdown telling me that I have been stressing him out about money and finances his whole life. I believe I have been up to this point educating him on the way of the world.

In general , my children have not been required to pay their own way with pretty much anything. We take care of cell phones, car insurance etc etc.

We go on disney trips each year. In general they do know how much things cost and the strain to the budget of the household if there is one.

How much information is too much. ? My boys are 15 and 19 , so they are not little

Any insight or sharing is appreciated

We tell them, mainly because they ask things like how much do we even etc. I don't see why not. We don't make them pay for things other than their own entertainment with their friends. But if we go somewhere together, we don't make them pay.

Edited to add, they are teenagers but we have talked to them about money, savings, etc. for several years.

 

[ajwolfe]

I have a 12 year old and a 9 year old...We put things to them in terms that they can understand...Like maybe we can't go to every fair, basketball game, etc if they want to continue taking a yearly vacation etc. Now that being said my kids are fairly spoiled and definitely don't go without much but I want them to understand that life is about choices and how those choices effect everyone in the family. My 12 year old is really beginning to understand how much it cost to maintain a household and learning to conserve his money better. I've been working with the 9 year old this summer in the grocery store getting him to understand what the best buy is - taking the size of packages into account vs the prices etc.

I don't think you should completely shelter your kids from learning about finances or they are going to be a hot mess when they get out on their own and have to make decisions for themselves.

 

[barkley]

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".....

I'm right with you- my favorite is when it's like a waitress at some little diner with somebody just finishing school and they are looking at $800K+ houses sticking their noses up... their mortgage is going to be more than they make? Did one of them inherit millions just before the show or something?

these shows just kill me-so unrealistic, and the inexperienced/unaware who watch them buy right into believing it's doable

it was an interesting conversation when dd opted to move out on her own (vs. staying home room/board free while in college only 20 minutes further away from campus). she initially looked at the numbers and only considered rent/food as expenses, it wasn't until we started pointing out the other items she was going to have to pay for that reality hit about the full 'cost of living' (her share of utilities/garbage/internet/cable, laundry & cleaning supplies, toiletries, renter's insurance....). same thing happened when she learned we had paid off our mortgage-initially thought 'mom and dad don't have any housing costs'-ummmmm YEAH we do. reminded her about how we still have property taxes, homeowners insurance, maintenance, repair and upkeep so it never really ends expense wise.

 

[barkley]

I've been working with the 9 year old this summer in the grocery store getting him to understand what the best buy is - taking the size of packages into account vs the prices etc.

GOOD FOR YOU!!!!

I live/grocery shop in a university town and you can't begin to imagine how crowded the stores are at the beginning of each new school year with mom's literally taking their adult children by the hands explaining to them how to shop-showing them how to look at unit prices, how to determine if an item on sale is truly a bargain as compared to purchasing an alternate brand, how to read cooking instructions to determine additional ingredients needed, how to use coupons and store reward cards......yet it's still common months into the school year to encounter well into adulthood students wailing to their mom's on their cellphones about how they don't have enough money to eat because 'who knew hamburger helper doesn't come with the hamburger in the box?'

 

[Sadie22]

Our children are not always grateful for everything we teach them at the time we're doing it, but maybe later they will be.

 

[tvguy]

My kids grew up knowing that if they NEEDED something, DW and I would find a way to buy it.
If they WANTED something, THEY had to find a way to pay for it.
School stuff, food, clothing we bought.
Video games, video game systems, toys, they bought.
We bought them probably the most boring, generic, reliable cars you could get, both got 1 year old used Hertz Tauruses.

Both inherited the cheap gene from me. Now that DS is married, to someone who is NOT cheap, he is having to adjust his thinking. Ah, love. He's still driving that now 10 year old Taurus. His wife, who is younger, is on her 4th car in 12 years of driving.

 

[flateacher]

We are very open with our daughters about the family finances. In 2008 right after our second was born my husband lost his job - I was on maternity leave. I went back to work - as a teacher and he started his own business. We changed the way we lived - permanently. The oldest was 6 at the time and now both of my kids are used to how we do things.

Since that time we do not have cable - I explained to my girls that $100-$200/month over 10 yrs is a lot of $$ to watch TV. I told them I would rather put that $$ toward their college. They get it. We do not have smart phones. We all have tracphone (although my aunt just gave me her used iPhone 4s and I converted it over). I explained again - $100-$200/month for cell phones compared to $100-$200/ year - I would rather pay for their college or a vacation. My husband is driving a used 2007 Prius. I have a paid off mini-van. My daughter now 15 will drive the 16 yr old truck we still have from when she was born. (She is actually excited about this).

The internet folks are coming over today to switch my provider - saving about $70/month. We don't eat out that much. We switched from Publix and name brands to Save-a-lot and making our own pasta, bread and sauces. We take the girls to u-pick strawberries and blueberries and I make jelly etc.

We shop at consignment and take the girls too small clothes in for trade out. They know to look for the tags that are 1/2 price. Even in a department store - they go straight for the clearance racks. Their favorite thing to ask in Target "can we find the clearance area?". We shop for school dances at Ross. My daughter found a great dress for $30. She was floored when her friends spent $200 for a dress for an 8th grade dance.

Recently, we got our retirement info in the mail. I had gone down (thanks Brexit). The oldest asked how much we lost. I did not share that information with her. But she knows we contribute regularly and when we meet with the financial guy.

I have often made them save their own $ for purchases I felt were wants (ex: iPad mini or a nook). They also know I take a portion of their gift $$ from relatives for birthdays etc. and put it in their bank accounts (they come with me and know how much is in there). They are also aware of how much is put aside for their college (so don't be thinking about Harvard without a scholarship!)

This is very different from the way I was raised. My parents still refuse to discuss financial information with me. I asked my mom about her mortgage payment and you would think I asked for a kidney! I wish they had talked about this when I was younger. They just said "save in your 401k". My husband and I always say - "I wish someone had told us ________". We think we would have done some things differently earlier on.

That being said - this is what we are comfortable with. I think every family will approach finances differently. I know my daughter's friends parents do....

Edited to add: the cell phone part is hard with a teenager. However, she has a friend who is also giving her an old iPhone 4s we are going to convert to a tracphone. She knows how much it will cost per year and if she goes over what I add she will need to pay for it.

 

[kj2mom]

This is something I think soo often about. I have two children, 14 year olds, and sometimes I feel like they know too much about money and sometimes I think they don't know enough. They have absolutely no idea how much money I make but they do know that I have a budget and no debt (which I would like to keep that way until they go to college). I never knew how much my parents made and they always had the money for what we needed (I don't remember ever asking for anything just because). Now looking back I wonder how they got that money for overnight camp, gas for the car to take me all over etc etc etc. It is frequently on my mind when I tell my children that whatever is not in our budget (it is just me and the two of them) that I am not handling it correctly or that they know too much but for some reason I just can't figure out the perfect answer. For example, my brother and I are 3 years apart and grew up pretty much everything the same. I am a pay my bills the second they come, no debt kind of person while he is the never open my bills, someday I might pay that, sure lets just use the credit card that we won't pay for decades to buy that kind of person. Same family life, same finances with completely opposite end results. Sorry, I know it stinks to read a post that offers no help but I just wanted to say I am glad you shared and know that you are not alone when it comes to struggling with how much to share and how much is too much???!!!

 

[niffer5150]

my kid, now almost 17, grew up knowing there is a finite amount of money we have to work with. when she was smaller we'd make fake budgets and sit with a pile of pennies working out scenarios. the frustration was obvious when i'd throw in "oh no! you ran over a nail and blew a tire! now you missed a day of work AND you have to get it fixed!".

a little older, i sat her down and showed her our budgets. we are pretty transparent with money because soon she needs to be an adult, hopefully capable of handling adult situations without getting ripped off or end up in financial trouble. there was a point where she was much younger and she thought she'd go off to college and rent a 3 bedroom apartment for herself and all the cats she was going to finally have. lol! i no longer get complaints about general "money stress". now it's more targeted complaints and grumbles about rising costs, teachers making her get text books she probably will use for one page, and how stuff isn't built to last or be upgraded anymore.

 

[MomToOne]

I admit I probably talked about money a bit too much with DD16 when she was younger. There is a fine line between teaching kids about money, and over-focusing on it and stressing them out about it. I think I probably crossed the line at times when I was frustrated about one major expense or another that popped up unexpectedly back when the economy was struggling and I didn't know if my job would still be there tomorrow. Basically the rule of thumb should be if there is a problem they really can't do anything about, then you probably shouldn't involve them in it. So if they are 10 and you can't pay your mortgage because you lost your job, that's probably not something to really be discussing with them. But if your grocery bill is going up and it's causing you to cut back on family fun money, that's fair game to discuss with them because they CAN do things that will help resolve the issue - stop fussing that they want every item in every grocery isle, eating store brand cereal instead of name brand, help out with recycling aluminum cans to raise extra money,etc.

That said, I don't know by your description that you've truly "stressed" your son out in that way. Sounds like he's just upset that he is actually expected to manage his money, and you won't let him hide his head in the sand like some parents allow. As I tell DD - oh well, life is tough. Deal.

Today, DD is aware I budget. She's seen the spreadsheet, but it's just a bunch of numbers on a page to her still at this point. We discuss the fact that there are trade-offs in life often. Want to go on vacation next summer? Well, then we don't eat out much and she doesn't get the latest and greatest cell phone. Want to get out of college with no student loans? Well, then live at home and go to the local college. Want a car because all your friends have one? Not my problem, I have retirement to plan for, save your own money. I give DD a monthly allowance, which she is expected to manage and buy all of her wants and even some of her needs with. That's been the case for years, and she's pretty good at it. She knows about waiting for sales/clearance, using coupons, calculating unit pricing to compare different sized products, etc.