On Parenting: Teaching kids about money

"Get the Behavior You Want, Without Being the Parent You Hate!" released by Demos Publishing.
Mar 12, 2015

Parenting and youth development expert Deborah Gilboa answered questions and offer advice on teaching kids about money.

Hi all. Thanks for joining the wonderful Deborah Gilboa and myself this morning. Dr. G is a family physician in the wonderful city of Pittsburgh (yes, can you tell I grew up there?). Her focus is on youth development and parenting -- and she has four boys herself. So although we're talking money today for the most part, feel free to pop in with general parenting questions. I had such a great conversation with her when I interviewed her for the piece on talking to kids about money, I think this will be a lot of fun. Onward!

Hi everyone! I'm so glad to be here! I'm Deborah Gilboa! I'm a family doctor and a mom of four boys, and I speak and write about parenting and youth development. The issue of money is one I've answered often on AskDoctorG.com - and this is such a great focal point for raising kids with the best of our values and life lessons.

Everyday your own money behaviors teach your children about money. Do you have a budget and stick with it? Do you use cash so children can SEE money or do you use a plastic card? Do you talk about getting paid for work or why you work? In this electronic age and automatic bill paying, do your children ever SEE a bill? Do you run up your balances for your credit cards? Do you have your children handle money? I give young children and teenagers CASH not gift cards. Gift cards teach them to SPEND money not THINK about what to do with the money. Ironically, I started giving money because the kids ask their parents to SAVE the CASH but with GIFT cards ask when can they go shopping!!!! So every day you are teaching about money good and bad habits.

I agree on many points. Deborah told me the same thing about cash when we were talking for the article, and it's something I try to be aware of now. I love my little debit card, oh so convenient. But I've overheard my kids talking about credit cards and even checks in a way that made me realize their little selves had no idea that was the same thing as money. 

You know what else helped my boys a bit? Toy cash registers. That's been really interesting, watching how they use that as they set up a "book store" or other retail shop in my living room, thinking about purchases and how to pay for things.

When we think money and kids, we tend to think about trying to hang on to our money now! I know I do. But we need to think about practice. Practice for earning and saving, but also giving our kids experience with impulse buying, and being influenced by advertising, and taking out loans. All the big mistakes they could make later are better off as small mistakes now! Giving kids cash is a GREAT way to teach those lessons!

My son, age 6, desperately wants to make money. For example, shovel a neighbor's sidewalk. Or sell his unwanted possessions at a yard sale. Or set up a lemonade stand. I admire this instinct, but age 6 seems a little young to try to make money. I would like to encourage his entrepreneurial instinct, as I worked a lot as a child, doing odd jobs for neighbors and babysitting. (But I started at age 8, shoveling snow with siblings...whereas my son is an only child.) But at the same time, we are trying to model the importance of doing kind things for others without getting paid (we shovel an elderly neighbor's sidewalk whenever it snows and we donate items to a local charity). He gets an allowance, which we set up under guidelines similar to those described in the article (money divided for spend, give, and save). His only regular chore (not paid) is to set the table daily and to help empty the dishwasher 2x a week. I think he could handle more chores, and we could certainly use the help. He does not set the table very well, and he often grumbles when it is time to empty the dishwasher. Yet I see him take great pride and integrate great detail in his various self-initiated creations. Any suggestions of how a child this age might be able to make money on his own, separate from allowance (and is this even age-appropriate?) And how can we get greater cooperation with chores? I know how important the chores are and am willing to invest some effort now to help him become responsible and capable as he grows older. Thanks!

My goodness, all great points and questions. Deborah? Take it away:

1. Should a 6 year old be doing small jobs for money

2. How can we get them to do chores without grumbling (is that possible?

3. How can we make sure they do things for other people ust to be kind, rather than seeking a few bucks?

These are great questions!

1. A 6 year old can be doing small jobs for money if he can build a client base. You can encourage his entrepreneurial spirit by challenging him to look around the neighborhood for work people might like to have done. After a rain or windstorm, there may be a lot of debris on a neighbor's lan. Ask him how much he thinks he could charge for clean up, and have him go pitch it to the neighbor!

2. It sounds like your son is frustrated about the work when it's someone else's idea - totally normal. Let him know that he doesn't need to say everything he thinks. You can make him laugh with this lesson by grumbling to him about each chore (each one!) that you do in the course of a day, or you can let him know that part of doing a job is the attitude and that, if he needs more practice with his attitude, you can find extra chores on his grumbly days.

3. Kindness is about internal motivation. So ask him to notice the "pay off" of doing something kind that has nothing to do with money. The satisfaction, the connection, the appreciation are all great, real reasons to help someone for free.

 

He gets a nickel and wants to spend it right away!! He also thinks I'm his official bank..Help please!!

Here is a video to help with impulse buys and allowance! 

Hello, We have a 12 year old boy who is addicted to his electronica (iPad, phone, tv). How do we wean him off of them? Is it too late? We try taking them away and the temper tantrums start. He is a good kid but we are afraid if we don't slow the electronics use down we will be in for some rough times down the road. Please help.

You're right to be concerned. I recommend thinking about screens the way we think about nutrition. We need a balance of healthy screen time to "junk" screen time, and only you can decide which games and activities fall into which categories.  I hope this might help: "Screen Time" Doesn't Really Mean Anything Anymore!

Hi, Deborah. How do you feel about allowances? I didn't get one growing up, and my partner received one sporadically. We're in a financial position where we can afford to give an allowance to our children (7.5 and 5.5), but I've read mixed things about what they teach children. This would be linked to chores. What do you think? Thanks!

I love allowance as a teaching tool, as Amy wrote about in her great article. They give all kinds of important life lessons. However, linking them to chores can be a really problematic idea, as then your kids can QUIT chores. Since we give kids chores to teach them important life skills and to get them to contribute their time and energy to our family and home, we do not want them to believe they should be paid - or be allowed to give up on- those responsibilities.

What is the biggest mistake you see parents make when it comes to kids and money?

Thank you for asking! I see parents often forget this important idea: Just because we CAN give our kids something doesn't mean we SHOULD.

Would you agree?

I see that in myself, and think "Oh, it's only a coloring book" or "oh, it's just one pack of baseball cards." But then they think these things just happen. By the way, as we've started talking to our boys about using their own money to pay for things, I'm finding them really excited to do this for themselves.

My child always asks for more than we allot - it's not easy to get them to stick to a budget, and they always argue their friends get more. how do we navigate this?

Wow, every kid since the beginning of time has tried that, right? Since we don't want our kids doing things "just because their friends are doing it" we have to model that strength and not be convinced to do something "just because our kids' friends' parents are doing it!"  Also, if kids don't learn to stick to a budget over time as kids and teens, they will NEVER stick to a budget as adults! So let them feel the pain, but don't give more without a fantastic reason!

What book(s) do you recommend on the topic of teaching kids about money?

For young kids, there are some wonderful Berenstain Bears books about money - like "Get the Gimmes!" For older kids I lean towards online resources. like FamZoo.com - which is an online banking system we use with our kids at home and has a great blog!

Is this chat no longer participating in post points?

Hi there. The On Parenting chat with Meghan Leahy on March 18 will feature the Post Points code. Thanks!

what do you think an appropriate age is to get a debit card, or a checking account? I'm worried about them losing it, about them spending more than their limit. any suggestions or thoughts?

YES! This is so important to approach. I have those same fears, but I'm even more afraid of that first credit card offer my son will find in his college mailbox without any supervision! So teach your kids starting at age 13 or 14, with a small amount and great supervision, to navigate first a debit card and then a credit card. Look at those statements together. A debit card is a good way to start because when the money is gone, it's gone!

My 4 year old (5 next month) constantly hits, scratches, and behaves aggressively with his siblings. He sits in time out, goes to his room, and has consequences with no change in behavior. I'm thinking about taking away all of his "violent" type toys (teenage mutant ninja turtle play swords, nerf guns, etc) and suspending all cartoons with fighting, but I'm not sure that will help either. I'm out of ideas, got any?

This is so common, and so frustrating! It sounds like your son is having trouble finding acceptable outlets for his anger or upset. He needs to be able to express those feelings, and he needs to find ways to do it that don't hurt (physically or emotionally) other people - especially his siblings. I hope that one of these two articles might help:

4 year old Jekyll and Hyde

Preschooler Hits

If not, please shoot me a message for more help!

 

My 5 year old has suddenly developed a fear of sleeping in his own room, and being anywhere in the house by himself. He insists we follow him and stay by his side any time he has to go to the bathroom, or into his room to get a toy or get dressed. He had been so brave and independent, this regression is very frustrating. We haven't been able to get much from him that explains the cause, though sometimes he'll talk about "monsters" and he says the light on the smoke detector scares him. We've tried "monster spray" (water bottle), zapping the monsters with "lasers" (LED lights), endless talking and reassuring, but this has been going on for two months with no real improvement. He says the only thing that will fix it is if we move to a different house, which is not happening. Any advice?

Can I say something about that monster spray idea? I used to think it was cute, but then I felt like if I gave my kid monster spray (I have a scared 5 year old, too), he'd be worried that there really WERE monsters. Maybe I'm wrong.

It takes patience, this scared thing. We do some things for him, like go and turn on lights, and other things we help him through just by saying we're there. One thing someone once told me was to tell him you'd talk loudly while he walked upstairs (or whatever) so he could hear you were right there. This is such a phase for kids this age, I think. It takes time...

Deborah? I'm sure you've had some experience with this...

 

This IS a phase, Amy, but a hard one on kids and parents. It's a normal developmental level to know that bad things can happen and still be stuck between the reality and imagination, especially at bedtime. 

The best response is to reinforce the idea that your chidl is a great problem-solver. Ask him for a few different ideas of what would help. Even though he may say "Sleep in my room every night!" you can ask for some other ideas. If monster spray is helpful to him, that is ok. You can tell him, Amy, that you know monsters aren't real but you respect his concerns and are happy to pretend while he is pretending. We do that a lot with our kids, right?  Play the monster game with the monster spray and then you aren't sending mixed monster messages! 

When I was a child I was never paid to help out around the house - with chores, etc. Do parents still do that? Is that a good tactic? Ive always thought it was appropriate to have kids do things around the house because that is good behavior.

I couldn't agree more! Paying kids to help out around the house implies that this is a choice, a job that can be accepted or rejected. Helping out, and doing chores, is a part of pitching in. Even better, it teaches competence and confidence, and shows kids how vital their contribution is to the success of our family! 

Paying kids to help you tackle a big, rare job like a yard sale or garage clean out is a different choice, and probably reasonable on occasion, especially for a child that goes above and beyond.

My youngest child wants the same allowance as his older brother, and puts up a fight about it all the time. how do I go about handling this so it isn't an issue anymore?

In our home (4 boys in six years!) we give allowance based on age. You can do one dollar per year per week or per month, like the 8 year old gets $8 a month, the 12 year old gets $12... that way it's clear that your 8 year old (for example) will get the same as his older sibling - when he gets to be that age! After you decide, and explain it once, you're done defending your position. You can tell your younger child that he can either say "Thanks!" or hand back the money for the week.

I'm terrified of my children having smart phones and apps that cost money. Anyone have any experience with this?

You are right to be concerned - both because of the content of certain apps, and for the in app purchases. There is great technology to help you monitor what your kids download in terms of apps, and resources to know which apps fit your family's values and which don't.  I hope that helps! 

Deborah, what about college savings? Do you have your boys involved in saving for it? And how do you talk about it, introduce them to the topic? I was telling my 7-year-old the other day that it costs a lot of money, and it started a strange and interesting conversation. Sometimes these discussions feel insurmountable! (This is Amy asking...)

Talking to kids about the price of education at every level is valuable! I think we give our kids the impression, that because education is a right for most - meaning they don't have to question if it will be there next week - that it's free. Anything we pay for to educate our kids, from school itself to books or materials or piano lessons or soccer fees, they should know that starting around age 8. Not to make them feel guilty but to help them judge the ROI: Return on Investment.

Involving kids in college savings depends on your own values, whose obligation you feel that money to be. But letting kids know that someone is saving up is crucial. We want them to value education, and also evaluate it critically.

I am an only child so I do not understand this sibling thing. Nonetheless, my two kids (boy age 7 and girl age 5) are friends but they argue and pester each other. Mostly, in my opinion, little sister pesters older brother. She will say something she knows is going to upset him or just disagree with him for the sake of disagreeing and starting and argument. There are times when I want to punish her (time out, scolding) for being... annoying. However, my husband is the youngest of three boys and he thinks her behavior is perfectly acceptable and I respect his perspective. What is the best way to handle a pesky younger sister? Tell the big brother to just ignore her (and allow her to continue to pester him) or tell her to stop pestering him?

This sounds like classic sibling bickering! First of all, make sure you feel comfortable differentiating bickering from bullying - which happens between siblings often, and is not always one child or the other as the main instigator. 

If it's just bickering, there are great solutions in this video!

I have an almost 13 yr old and she is full of attitude- with eye rolling, "smart-ass" answers, as well as the belief that she knows everything. I can't tell her my advice or offer my opinion, even though I have lived through so many of the things she's experiencing. She is really shutting me out. She used to be so sweet. What should I do? I can't listen at 11:00. Is the recorded conversation available at other times? Thanks

This chat will be archived on the site. (live.washingtonpost.com.)

It sounds like there are two questions here.

1. How can you get her to speak to your respectfully? Because you deserve that, and she needs to learn that skill. She needs to speak to your respectfully always, even when she doesn't feel like it because it's the right thing to do, and because she needs to expect respectful behavior from other people towards her. So here are some tips for that. 

2. How can you get her to take your advice? Stop giving it. She knows you are a great problem-solver. She needs to learn that SHE can be a great problem-solver. So ask questions, show empathy for her feelings, be interested in her solutions and stop offering yours. Eventually she will ask you your opinion, but only after (and it can take YEARS) she trusts you to believe in her opinions. Of course she's going to get it wrong a lot, that is how she learns.

Do you have one lesson about money you learned yourself as a kid that you’d like to share?

I learned that not being able to afford something could make me sad or make me motivated to find a way to earn. Motivated is a lot more powerful.

Thanks for asking!

I am seriously considering starting an allowance for my 6-year-old that is not directly tied to specific chores around the house, just as you suggest. Essentially, the allowance would be for being a 'good citizen'--doing basic stuff in the house that we all have to do, to keep it running (fairly) smoothly. But I'm wondering--what if he has a really bad week, as far as LOTS of not listening, not doing even the most basic stuff, etc.--would that be a situation in which you might revoke allowance? Or is there ever a situation when you might revoke this type of allowance for bad behavior? While I like the idea of not tying allowance to specific tasks, i'm worried that if he has a terrible week behaviorally (which he sometimes does), it will be almost like he's getting 'rewarded' for it if when he gets his allowance.

I'd like to encourage you to start this allowance now!  Further, I'm going to suggest that you don't tie it to anything. That you be clear in your reasoning: We are going to start giving you an allowance so that you can learn about money! Teaching you about money is my jobs as your parent.

That way, when he has a bad week, you might choose to not let him take that spending money when you go to Target, but receiving the allowance is not payment or reward for anything at all. It's a teaching tool, like the books in his room.

Many folks are talking about chores. Just wanted to give you all access to the free chore chart on my site. Just go to this link and put in your email for a free downloadable chore chart and other free parenting tools!

When I signed my boys up at ages 13 and 14 for their first checking accounts/debit cards, the bank tried to automatically sign them up for overdraft protection and its accompanying charges ($30 a pop!). I said no thank you. The bank manager thought that wouldn't they be embarrassed if they couldn't pay for a meal, etc., and shouldn't we shield them from that. And my response was NO...that's exactly what needs to happen if it happens. That's how it keeps from happening again! There are so many tools at hand now, with online banking, instant balance inquiries, etc that they need to be familiar with and know how to use them.

That is fantastic!!! I couldn't agree more. I only hope my son at 16 will discover he doesn't have enough money on his debit card to pay for his date's pizza - THAT will teach a lesson like nothing else!

My almost-4-year-old has taken to throwing tantrums over the most banal topics when we're in the car (generally driving home from work/daycare). The drive's about 30 minutes, which is an unbearable length when this "crying" all the way (loud and purely theatrical). Generally, the fits have been over food. During the drive, I give him a healthy snack -- generally some apple and water -- to hold him over until we get home for dinner, but he'll insist he needs more. I have some crackers and mints stashed in the car for me, but he knows about them and screams that he's still hungry. I don't want him to fill up before dinner, so I'll let him scream for a bit and do my best to redirect him to a non-food topic. I've endured tears for the full drive more than I'd like to count, but I've been known to cave when my head's pounding and I just want some peace. I often wonder if the ongoing 30-minute cry fest is worth it. Is it? Do you have any other suggestions?

Here is an idea - have "appetizers" in the car on the way home. He can help you pack it up the night before. Tell him you've cleared all the snacks out of the car, and instead you're going to have the first course of dinner as a car picnic. 

Make this course all healthy - but fun shapes in tupperware or his choice of three vegetables. Whatever will make you feel satisfied that, if he is too full for dinner it doesn't matter because everything he ate  was great nutrition. If you're worried he won't sit through dinner when full, let him know that is part of the "Car picnic" deal - he has to participate in family dinner even if he doesn't eat.

Amy again. I think I saw you on a news show mentioning, um, a fart gun that one of your boys really wanted. You let him buy it, right? Can you talk for a second about what your theory is behind a kid wanting to buy something you think is a bad purchase?

Yes, you sure did, and here is that CBS clip for anyone who is curious! If your child wants something, and it is not totally against your family's values (fattening, immoral, unethical, whatever) then it's a good experience to let her save up and get it!  It shows that you respect your child as separate from you with her own interests and tastes, and lets her learn whether it was worth it!  For the record, my son still loves that fart gun, considers it his best purchase EVER!

Thank you so much for your great questions and smart ideas about kids and financial literacy! For free resources from me, I hope you'll go over to my site and grab them here!

My books, including Get the Behavior You Want... Without Being the Parent You Hate! are all here.

And if you have a question we didn't answer, or are looking for a speaker for your school or conference, let me know!

Have a great day!

 

Thanks Dr. G, and all of you, for the lively discussion today. So much to think about. Join me again for our regularly scheduled On Parenting chat Weds., March 18, with Meghan Leahy, whose latest column about SLEEP is here.

In This Chat
Deborah Gilboa
Deborah Gilboa a family physician in Pittsburgh who focuses on parenting and youth development. Her most recent book is "Get the Behavior You Want, Without Being the Parent You Hate!" released by Demos Publishing.
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