7 Ways You’re Teaching Your Kids Bad Money Values


Long before they start going to school, children can absorb money lessons passed on by their parents, who are their first teachers and role models. Parents have a crucial role in honing their kid’s financial knowledge and skills and the lessons they learn from them stick like glue.

Kids and moneyWith this, you should be aware of what you teach your kids because even the simplest parental misconception and action they perceive from you could send them wrong messages about money. Here are seven ways you are imparting bad money values to your kids and you’re still unaware of it.

1. Caving into the tantrum

One of the challenges of being a parent is saying “no” to your little kid when he or she wants to buy something. If you say no, your child may make those conscience-stricken puppy eyes or worse, throw annoying tantrums. The worst thing you can do to stop the loud sobs is to give in to your kid’s demands and buy the stuff. Tolerating this behavior leaves your child feeling entitled, which is a bad thing.

Make it clear to them that they cannot get all the things they want but try deal with it in a more positive manner. For instance, you can foolproof your kid by saying “Barbie can’t go home with us so you have to say goodbye to her.” Divert the feeling from possessing the item to letting it go.

You can also tell them beforehand that you’re not going to the mall to buy something for him and her so your kid will learn that going into the store doesn’t always mean you have to purchase something.

2. “We cannot afford that” stock answer

Saying “I have no money to buy that” is a surefire way to shut down an entire conversation. However, the statement isn’t always the best way to go. It may leave your kid feeling resentful about the way money is being spent in the family. Your kid may feel hurt and may not understand why you bought his sibling a new pair of shoes while he can’t get the video game he asked for.

When you have to say “no”, always follow it up with a reason. Make your kid understand the difference between a “need” and a “want.” Giving the control right back in their hands, asking them “how can you afford this?” also allows your kid to think of money as something they can earn and control.

3. Using plastic without explaining it

Girl with credit card

When visiting the bank or making ATM withdrawals, my mom used to take me with her. I was amazed by the power of the card she’s holding. She inserted the card into the machine, clicked a bit, and money magically appeared. She also used the same card when shopping and we were able to leave the store without paying goods with tangible money.

The idea that you can have whatever you want, whenever you want it, as long as you have that magic card, was glued on my mind. It took me long enough to understand that magic does not exist in the real world.

Walk your kid through transactions and explain to your kid how banking, debit, and credit cards work. Make it clear that the money you work for is deposited automatically by your company into your bank account and the cash you take out from the ATM machines or debit cards come from those funds.

4. Shielding the kids from money talk

“What are you talking about, mommy?”
“It’s just between me and your dad, sweetie. You’ll get it when you’re older.”

According to Laura Levine, the president and chief executive of the Jump$tart Coalition for Personal Financial Literacy, the mistake parents make the most is they don’t have conversations about money with their youngsters. Parents tend to be hesitant about discussing financial matters in front of their kids, thinking that they won’t understand or they might reveal sensitive information. The absence of information, however, can lead to kids drawing their own conclusions based on what they see or overhear.

Answer when they ask. Well, you don’t have to disclose the amount of your salary to them or worse, expose your arguments about money. Just try to base the context on your kid’s age and give him or her a gist of how money works and funds is allocated to the family.

5. Not walking the talk

Saving money

Actions speak louder than words. Keep in mind that long before they start going to pre-school, kids are able to learn from your actions. So if you make impulse purchases on a regular basis without planning or you have the habit of not paying your bills on time, leaving a stack of unpaid bills and loans on your kitchen countertop, your youngster will comprehend a negative message and may think it’s normal.

So instead of merely preaching the importance of saving, the difference between needs and wants, and the struggles of earning money, be a good example. Show, not tell. The next time you’ll go to a bank to make a deposit, take your child with you and explain the step-by-step process and encourage him or her to do the same with a piggy bank.

6. Mindlessly implying a wrong impression of your spouse

If your kid sees your spouse paying all the time, your kid may think that it’s the other parent’s job to provide and pay the expenses. If you ask your kid “not to tell daddy” that you bought something from the mall, your kid may think that daddy is a scrooge.

These things, from little misconceptions to little white lies, can get stuck on your child’s head and may cause some tension in the family. With this, try to make it clear to your kids the roles you and your spouse play. Instill in them the idea that mommy and daddy work as a team and no parent is greater than the other.

7. Making the “bank of mom and dad” always available

What if you already gave your son his weekly allowance yet he still asks for money for a lunch out with his classmates because he splurged his savings on a pair of shoes he doesn’t need? To avoid crushing his young heart, you’ll bail him out and give him extra money. Wrong!

Let your kids handle their own money and when they made poor financial decisions, let them be disappointed. Stick to them the idea that there won’t always be a “magical bank of mom and dad” they could cling to so they have to make wiser choices in spending.

Carmina Natividad
Carmina Natividad is one of the daytime writers for North Shore Medical Group, a prominent group of medical clinics based in Sydney, Australia. She is also a contributor to Speedy Money. Her articles mainly include practical tips on health, fitness, finances and beauty.
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