Today we are lucky to have Shannon Ryan from The Heavy Purse on the blog. I hope you enjoy her post and the iPad Mini Giveaway!
DC and I have been blogging friends for quite some time now, although I’m past being able to convince anyone that I am a Young Adult, and he has been a regular reader of The Heavy Purse even back when my blog was pink. :) One thing he has constantly mentioned is his desire to be a good financial role model when he becomes a dad in the future. And every time he does, it warms my heart. Being a good financial role model is the first step to creating financially confident kids.
I’ve been a Certified Financial Planner (CFP®) for more than 20 years and every parent I have met wanted their child’s success to exceed their own. Often times they think it means giving their kids everything they want and never saying “no”. This only increases the chances of creating entitled kids, which may actually hamper their financial well-being. The best way I know to teach my daughters is to demonstrate the behavior first, so when my girls were toddlers, my husband and I began having basic money conversations with them. Today, they are 10 and 8 years old and are financially confident kids.
Words and Actions Need to Be in Alignment
Our kids are always observing and learning from us, even when we don’t realize it. And most of us send a lot of mixed messages to our kids. Have you ever …
- Told your children “no, we can’t afford it” without explaining why and then proceeded to buy something for yourself?
- Complained about what others have and said they don’t deserve it?
- Argued about finances with your spouse in front of your children?
- Justified a purchase because you had a bad day and “deserved it”?
Don’t feel bad if you have ever said those things in front of your kids in the past. What matters now is that you are mindful of your words and actions ongoing. Speak about money in a positive manner where you appreciate your money and express gratitude for what your money does for you. Stop comparing your life to others and focus on identifying and using your money on the things that matter most to you and your family.
Watch your money emotions because your kids are very sensitive to them. For example, if you find that you are often angry about money (complaining about others having more), then they will likely emulate the behavior as adults. They may focus on what they lack and become bitter or fearful of the anger money creates so they placate instead of being honest, even if it means agreeing to poor money decisions.
Set Goals to Give Your Money Purpose
We explained to our daughters that goals give our money purpose and act as a barometer. We always find new things we like, but if we buy everything we want, we may not achieve our goals, which are the things we want the most. This is why we always ask ourselves, “Does this bring closer or further away from my goals?”
When they would find a new toy, we would remind them of our goals and almost every time, they agreed our family vacation (our save goal) meant more than a new doll. And today, I get such a kick when I watch them ask themselves, “Does this bring me closer to my goals?” and choose to honor their goals. Best of all, they don’t even feel deprived because they know they are ultimately getting what they truly want.
Explain How You Make Decisions
As your kids grow older, it’s important that you let them see under the financial hood, so to speak. Don’t internalize all your decisions at the store, but talk out loud and share with your kids how you decide what to buy. It’s not always about price, so explain when quality or values (such as eating healthy) affect your decisions and what you buy.
Share Your Money Mistakes When Appropriate
This one can be tough for parents; we don’t like admitting our money mistakes. At the same time, we also know that we learn from our mistakes so don’t hide them from your kids. When the time is right, share some of your mistakes with them. Explain why you played “keep up” or whatever your mistake was and focus on what you did to recover. Your kids will make their own money mistakes but knowing that you can recover from them makes it easier to take positive action and move forward.
Being a parent is a role I take very seriously. It’s my responsibility to be a good financial role model to my girls because some day they will model the behavior I taught them to their own children. And I feel pretty confident that they will make great financial role models.
Making Money Conversations Fun and Easy
Financial literacy is my passion, and it is easy for me to talk to my girls about money, but I know it’s a struggle for some parents. One easy and fun way to help you start these important conversations and shape how your kids think about money is through my children’s picture books. I’m pleased to offer Making Sense of Cents readers an exclusive coupon code TOUR3114 for $3.00 off my new book, The Lemonade Stand. Join Lauren and Taylor in their continuing money adventures as they teach their friends, Ryan and Christopher, how easy it is to save, spend and share.
About the Author: Shannon Ryan is a Certified Financial Planner and a Mom on a mission to help busy parents teach their children simple, value-based principles that guide their money decisions and support their long-term financial well-being.
The Lemonade Stand – iPad Mini Giveaway
July 14-31, 2014
Sponsored by The Heavy Purse
We’re Giving Away an iPad Mini to One Lucky Reader!
Help us celebrate the release of The Lemonade Stand and join Shannon in her mission to increase financial literacy in both children and adults.
“Everyone handles money. Unfortunately, not everyone does it with confidence. Money has long been a taboo topic in many homes, which makes it even harder for parents to know where to start or what to teach. So I created a series of children books to help parents ease into these important conversations. Financial literacy is one of the most loving gifts you can give your children, and I encourage you to make money conversations a priority in your home.”
The giveaway runs from July 14-31, 2014 and is open worldwide.*
* A winner located outside of the United States will receive a cash equivalent prize via PayPal.
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Great advice, there, Shannon. Their little ears pick up a lot and usually magnify or distort what was said.
GREAT GREAT GREAT article! I loved this one. I really loved this:Told your children “no, we can’t afford it” without explaining why and then proceeded to buy something for yourself?
I wrote an article about the same thing a while back. Being a good role model is important and immaturity and irresponsibility like that is not the answer. I’m so glad you mentioned that point.
Wow Shannon, I have NO idea where you found the time or energy to write all of these blogs, and I tip my hat off to you! This is yet another great one. It is really difficult to admit our mistakes, especially to our children, but it’s the best way that we can take a bad situation and turn it into a good one. Mistakes are even better teaching lessons than successes and we need to use them as such.
My parents didn’t teach me anything! So I was terrible with money, at first. I teach my kids by having the save up for things that they want and by showing them how I do the household budget. I also regale them with stories of my childhood and how there wasn’t enough money to even pay the bills, let alone buy frivolous things like ice cream cones or my little ponies :)
AnastasiaFall Sadly, this happens all too often, although hopefully we can change that! I’m glad that you’ve found your financial footing and are teaching your children to be money smart. It’s really good that you’re taking the time to work with them on budgeting as that is an important skill that is often overlooked.
blonde_finance Me neither! I am exhausted but so grateful to have wonderful friends like you and DC to support my book launch! :) It is very difficult to admit mistakes. We feel as though we failed, although I don’t think our kids see it that way at all. It’s probably a bit of relief and they are more willing to hear what we did wrong and fix it versus when we just tell not to do things. Mistakes can truly be great teaching lessons and sometimes – forgive me for this – you need to make lemonade out of lemons. :)
MoneyMiniBlog Thanks, Kalen! That’s one of my favorites too. “We can’t afford it” has become such an automatic response for parents that they don’t even think about their actions afterwards. It’s confusing for kids to be told there is no money for their toy, but then have their parents buy something for themselves. This is why kids feel deprived, even though they really are not, but it sure feels that way when Mom and Dad won’t buy you what you want but buy themselves whatever they want. It’s so important words and actions are in alignment and that we, as parents, are mindful of our words and actions. :)
debt debs Absolutely, Shannon. Those little ears hear EVERYTHING but they don’t necessarily understand everything they hear. And because so many parents don’t openly discuss money, their mistaken beliefs became reality. It’s so important to be a good financial role and openly talk about money, so when kids do misunderstand, you can correct them now, rather than have them need to work it out later.
Thanks so much for your support, DC. I really appreciate it. :)
I taught my kids to save money for the things they really want, and also how to earn it!
ShannonRyan Of course! It was my pleasure. Thanks for posting and letting me participate in co-hosting the giveaway : )
My parents taught me about money by modeling good habits and letting me learn through experiences like managing an allowance and deciding what to do with money I earned from babysitting and other part time jobs.
Start investing early. Compound interest is an amazing thing!