How To Talk To Your Kids About Money

Parenting is an exciting task, right? Especially when that task consists of training your kid to have a wallet and how to spend, save, and pinch every penny they come across. It’s a given that parents don’t know what to expect. My wife and I certainly didn’t have a clue with Munchkin, but we gradually got the idea that when they start needing money or supplies, you have to prepare yourself mentally and emotionally.


Start teaching them about money when you teach them about manners. It starts with their youth: they’ll ask for something when you’re tight on cash or just don’t feel like spending a dime after bills; trust me, it’s gonna happen. You’ve just finished paying off your car or mortgage and your kid is going to ask for the most expensive toy there is. How does a parent handle this? Easy, don’t get upset about it! The last thing you want to perpetuate to your kids is that money is a stressful, upsetting ordeal and they won’t want to come to you for it if they need it in the future.

It comes down to psychology. If your kid wants some brand new game for $50 and it doesn’t seem to be priced accordingly for something they may or may not play with much. So how do you let him down? You can try the good ol’ “We’ll wait until it goes down in price” but sometimes that doesn’t get through to kids. Kids are curious, and they’ll want to know why – so tell them the truth in a way they’ll understand.


If they come to you and ask for the $50, try saying something along the lines of “I’m sorry, but we can’t spend our money on that because money is hard to make. We have to be careful with our spending choices.”


Of course, they may not get it the way adults understand it, but the important part is they’ll remember you didn’t get angry or simplify the conversation to “it‘s too expensive“, as that could imply you would buy it if you could afford it.


I recommend telling your kids the honest truth; the house, bills, taking care of the family car, and clothing can add up and make certain luxuries harder to obtain. This may also be a good opportunity to point out something to me that I didn’t quite notice when I was a child – the difference between “want” and “need”. Your kids may feel so compelled to have something they want that they will claim to need it. Make sure your kids know the difference and ask them – “Do you really need this, or do you want it?”


Make an example of your own shopping choices. Your kid might have a smart mouth and ask, “Do you need, or want that, mommy?” If that’s the case you could say, “Well, I wanted this one, but it’s more expensive. So I’m choosing the lesser expensive option – the quality is better and I’m spending $5 less.” Your child might soon understand that if $5 differences are important, then $50 isn’t something to belittle.


Secondhand stores are something to take note of, too – if your kid wants a new pair of jeans, buy them from a thrift store if you can, and rewash them. Make a point in front of your kid to say how $20 can get them four pairs of jeans, rather than going to retail stores and spending $22 on a single pair.


Most importantly, talk with your kids, not to them. Make conversation about money. You’ll learn your kids’ developed opinions on the subject, and learn what they have to say about you – because chances are, they see your face when you pay the bills and swipe your credit card. It’s vital to your relationship with your kids to discuss money as a non-taboo subject. They might be too young to understand it right away, but as you make repetition of certain behaviors and phrases, they’ll pick up on your reasoning later on.


It does take elbow grease to raise a kid in an economical standpoint such as this one, but great parenting doesn’t have to be cheap, even if your shopping is.

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