Teach the Next Generation to Stay Out of Debt

By: Joe Larson
Submitted: 2008-09-15 17:52:35
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Kids and budgets, these are things that simply do not go well together. I joked that my kids had "cash radar" or a special homing beacon for my money. If I had any money, they'd come up to me and say, "Dad, I need this or that." And, amazingly, they always knew how much I had. While that might be stretching the point a bit, anyone who has kids, especially those who have teenagers, can probably relate.

Becoming a little more serious, it's crucial that we teach our kids how to budget money. Our children look up to us and learn from us as their parents. They observe us and soak in every move we make, even bad habits. It's hard for me as a parent to tell my kids no. After all, I want to give them everything they need, and that might include everything they seem to want.

However, in the real world, I cannot give them everything. To prepare them for real life, we have to teach them how to budget, the importance of managing one's money, and patience. We have turned into people who need instant gratification. Without thinking about the final cost we place our things on a credit card.

When our children are young, if they see us buying whatever we want, we are teaching them that this is normal. By buying impulse items, they learn to buy on impulse. I first experienced teaching budgeting to my children when my eldest daughter was in junior high school and she began coveting brand name clothing, although these items were not in our normal budget. I also noticed that, when she got these items, they would often be used or worn only a few times before being discarded when they next popular trend began. My daughter received an allowance once a month, so I told her she and I would go in halves on purchases. Once she realized that her money would be needed for purchases, her wants were more limited.

We also noticed that, because we had to wait before purchasing some items, fashion trends would changes and prices, in some cases, would drop. We also attempted to put aside at least half of her earnings into savings.

And finally, we talked about budgets, debt, and credit cards before she went off to college. Often, college students are lured by credit card companies, so they really need to know about debt. As parents, the best thing we can do is to help our children start their lives off on the right foot by giving them the tools they need.

Family is very important to Joe Larson, one of the Christian credit counseling services at Family Life Credit Services. He wants to ensure that all families are prepared to teach their children about financial security. non-profit credit counselors services are just the thing for families in debt or families needing lessons in money management.

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