I’m sure that sounds familiar…In fact, maybe you grew up hearing it. And today you may even say it to your children. So what does that statement really imply? Perhaps money doesn’t come easily, or you need to work hard to have money. And with that message, it’s no wonder that money will be difficult to earn. It’s sayings like “Money doesn’t grow on trees” and “Money is the root of all evil, and “What do you think I am, made of money?” that set up those negative money patterns for life. And if that’s what you grew up with, then what message are you sending your children?
This is important to understand, since teaching children about money and financial literacy is just as significant as teaching them their ABC’s. Teaching your children to have a positive relationship with money is a gift that will serve them for the rest of their lives. Just as you teach them the importance of eating right, brushing their teeth and taking care of themselves, so too is the need to educate them on the value of money, how to respect money, and the importance of financially supporting themselves. Without this knowledge, life can be pretty difficult to navigate; and to make up for it, they’ll have to try hard to get up to speed in order to be financially stable in their adult life. The statistics on this are alarming. Young adults age 18-24 are the largest growing population declaring bankruptcy today. In fact, bankruptcies in this segment have increased 96% in 10 years.
Helping children understand what money represents and what it can do for them is an important first step. Money is simply an energy, and it has whatever meaning that they choose to give to it, whether it be freedom, security, power, fun or independence. You can encourage them to feel good about money by helping them to understand the many uses money can play: living a good life, supporting themselves and their family, helping others, investing in their future, donating to specific causes, etc. What’s really essential is that they honor money by using it with positive intentions unencumbered by limiting beliefs.
Teaching children to be responsible with money is key. Being responsible with money means knowing how to earn it and knowing how to save and invest it, as well as being aware of all expenditures. When young adults act responsibly in this way, they get the message that they can take care of themselves, which fosters self empowerment.
Talking with your children about the importance of money is not enough. Remember it’s not so much what you say but what you do…your actions and your results speak louder than your words. For example, if you say that it’s important to invest your money but they constantly see you spending it, they may internalize the need to spend money just as you’ve shown them. Therefore, to counter the impression of spending, consider demonstrating how you regularly make deposits into your savings or mutual fund accounts.
Being aware of your own money patterns gives you the ability to separate out the positive messages that you want to send to your children. An example of one such positive message is that children need to feel that as adults they “deserve” to have money, in addition to the right to earn a high income. It’s important for them to feel deserving of it, rather than making it about how hard they must work or about the need to prove their worth. And there’s no reason for them to “give” themselves away or compromise themselves to earn it, either. It doesn’t have to be that hard, so why perpetuate this type of struggle.
Ask yourself, “What positive money messages do you want your children to learn?” Write out your ideas about earning an income, saving money and investing, and then share these thoughts with them.
The results of financial guidance…priceless.