Teaching Our Kids Money Management Skills

Kids Financial Planning Money Training Family

 

 

Our identical twin boys are nine, and going on ten this April.

As non-custodial parents we are not the first couple to play the part of “indulgent parent”.  We get our kids approximately ten days per month according to Texas law, which never feels like enough time with them.  We have a flow and a schedule that works well between both households, and extra vacation time in the summer.  This year, we’ll be ready to take them for the full four-weeks we’re allowed to have them (about half their summer break).   I can’t wait!

When the twins are with us, we try to do as much as we can with them.  Whether that is going out of the house and finding cool things to do, going out to lunch and dinners (where budget allows), crafts, baking … we try to make the hours count.  But in the middle part of 2015 I began to notice a trend that I disliked quite a lot.  Expectation.  Our kids no longer anticipated a special treat or event; they expected it, without earning it.   And the more I observed this problem with “expectation” the more I was able to see how this could quickly become a problem.

What type of teenagers did we want?  I want our kids to get a part-time job and save for college (naturally we’ll help).  I am a strong believer in working for the things you want (I put myself through six years of post-secondary education without a single student loan).  I left college and university with less than $2,000 in credit card debt too (pesky text books).  The point is that while I wished my parents had been more supportive and less selfish, ultimately I hit the age of eighteen years and had two choices.  Go work in a factory as my parents had, or bust my backside and launch myself into education and hopefully, a white collar career.

When I was in high school I worked at a hotel doing banquet service, hauling dishes and food, chairs and tablecloths.  I worked with my friend’s family, but it was hard work at the age of 14, as I was often on my feet from about 3:00 p.m. to about 1:00 a.m. every Friday and Saturday night.  The group tips at the resort were great, and I would usually earn myself about $20 for both days (I was only paid about $4.00 per hour back then).  I kept my paychecks in my bank account for clothes and savings, and lived a good life on my tips.

My next part-time jobs included working in the gift shop for the resort (now that was a sweet gig!).  I worked six days a week and really made quite a lot of money.  And that was a good thing because I needed too; that’s when things went atom bomb in my parents marriage and myself and my sister became something of a casualty and afterthought.  I got a car and became independent as quick as I could; working six days a week meant I did not have to be home.  I was also allowed to do my homework while minding the posh gift shop.

I worked summers in a car factory making big bucks, but paying the price with sore muscles.  That was fine with me, because a few bruises and burns from robotic welding machines were worth making over $450 per week.  That was big bucks for our small town, and all of it went to keeping my car on the road and my education.  And eating out as much as possible to avoid our house.   I ate a lot of submarine sandwiches in town and played a lot of pinball.

The point is that I have always worked, and Kevin has a similar story.  He liked having money and independence too.  What I would not like are kids that stand there, without any sense of work ethic or the ambition to earn money, and with their hands out.  Money is not magical, it does not simply appear and in our efforts to indulge our kids as much as possible with love and “stuff” we were setting them on a path of “expecting” money for doing nothing.   This is a very common problem with kids today (oh my God … I said ‘kids today’ … sigh).  

I’ll be damned if our kids are going to grow up selfish, lazy brats with no concept of how money, savings or hard work … well, work. 

What a mess! LOL :) #Pizzanight #Twins #kidscancook

And my little men are starting to learn to cook (as they should right?)  Proud of my Reese’s Pieces.

Our kids have a sign on their bedroom wall, and it reads something like a price list, outlining earnings for chores that are appropriate for them.  From cleaning the bathroom to brushing the dogs, sweeping the back porch to vacuuming the carpets and dusting, they can earn anywhere from $1 to over $4 per chore.   They can also split the chore if its a larger one and split the earnings.  Teamwork for the win!

But earning money wasn’t enough.  We stimulated a little competition between them with separate piggy banks.  One is an inherent saver, while the other is a flamboyant spender.   By praising our saver, our little spender got jealous and began to save too.   Logan also noticed that Lucas was able to buy cooler toys if he saved up, and Logan has started to emulate Lucas’ behavior (work hard, spend some, save some).    But what was really magical about their spending habits was how readily they changed, once they had to earn the money they spent.  Before, a $20 toy was a no-brainer … throw it in the cart and ask Lori or Daddy to pay for it.  But when THEY have to buy the toy, suddenly a whole new dialogue happens.  Is the toy worth $20?  Do they have another toy just like it?  Does it look like it will break easily?

I am utterly impressed and fascinated by the dialogue.  This is really really good!  Purchase decisions are influenced by cost, and by an evaluation of the number of chores it took them to save up that $20!  And that… is awesome!

The kids were offered about $10 each of chores the last weekend we had them.  Having just come back from a shopping trip and spending all their money, they were tired and not interested in doing more chores.  I explained that they each had less than $2 left in their piggy banks, but they were fine with it.  Some helping chores are done without pay (because they are family chores) but the paid chores are optional.

 

And sure enough this weekend, they were reminded that they had no money, when Daddy asked them if they wanted to go into town with them.  The twins came running to me with promises of doing chores if I could “front them” some cash.  I was tempted.  It’s pretty cute when you have two little men negotiating with you in earnest, but I stood my ground.

 

“Remember two weeks ago when I warned you that your savings were gone, and offered you guys chores?  What did you tell me?”

Lucas replied, “That we didn’t want to do the chores, even though we didn’t have any money left.”

“That’s right.  Broke sucks huh?  You can stay home if you don’t want to go into town, since you don’t have any money to spend.  Or you can just go and keep Daddy company.  It’s still fun to be together, even if you have no money.”

Logan straightened out his shirt for the pitch.  “Well, you could give us each $10 and we could do chores when we got home?”

I squinted my eyes (although I was laughing in my head).  “That’s not how working for money works son.  Work first, then get paid.”

 

[Insert polite but tandem sulking]

 

They did go into town with their Daddy.   The did not however, come back and offer to do any chores like they had promised.  Rather than harp on them about paid chores, I said nothing.  Two weekends from now we may repeat the same lesson, and that’s fine.  They are nine, and they are experiencing what it is like to earn, to save and to plan their spending and their earnings.  I think these lessons have to come from trial and error, and testing our resolve (no we’re not giving you spending money for no reason).

I haven’t always been the best with money.  I was a saver, and sabotaged several times by my Mom and then life circumstances beyond my control.  Rich, poor, rich… poor … poor… (eating much rice but buying really great dog food for Diego).  The adversities have taught me to be very resourceful with my money, and being a freelancer and small business owner, I know how to work a budget.   And I want our kids to be smarter than I was with money, so that they’ll have the tools to work hard and accomplish their dreams.

I don’t want our kids to be the indulged brats I see on Instagram or television documentaries, complaining about the 1% and telling people that they should have their $40k debt of student loans paid off by society, because they opted to live away from home and not work during school.  I don’t want our kids perpetually with their hands out, expecting the world to provide “just because” they think it should or “just because” they want something.

Set goals. Work. Save. <—- No short cuts if you want to get anywhere in life.

And I don’t think it’s ever too soon (or too late) to get your kids the kind of training and reality check that will serve them well in life.    We’re raising someone’s future husband, and someone’s father after all.