7 Things Your Kids Should Know About MoneySteve Siebold
School’s out (or about to be), and soon your kids will be asking for money to go to the movies, hang out at the mall, or buy a new bike. While many parents dread talking to their children about money (some avoid it altogether), the summer provides a great opportunity to teach your kids important financial lessons.
What your children learn at an early age serves as the foundation for the rest of their lives. Parents are the primary creators of their children’s belief systems and therefore should consciously and carefully craft every belief they pass on — especially when it comes to something as important as money. The irony here is that the average family unconsciously passes down the same limiting beliefs about money from one generation to the next, and it’s these beliefs that have kept families at the same level of financial success or failure for hundreds of years.
The middle class maxim: Get a good education, find a job, get married, have kids, and be grateful for what you have. It’s not bad advice, but it’s also not going to set any child up for world-class success.
The most financially aware parents, on the other hand, teach their kids the truth about money, starting with how misunderstood it is. They teach them that it’s right to want to be rich, and it’s possible for anyone who thinks big. These parents never manipulate their kids with money, lest the child learns to see it as a tool to lord over others. They educate their kids on how to make money by solving problems and enhancing the quality of other people’s lives. This way the child learns to see money as a positive, productive force for good instead of a weapon of the few to use against the many.
To be as financially aware of a parent as possible, here are 7 things you should teach your kids about money.
7 Things Your Kids Should Know About Money 1 of 8
It's easier than you think to raise a financially savvy family!
Some people have more money than others 2 of 8
It's a nice thought to say everyone, regardless of financial status, has access to the good things in life. It's also naÃ¯ve and untrue. Explain how a small percentage of the people own the majority of the wealth, and that most people settle for less than their share. Some parents call this an elitist way of thinking. They say rich people are teaching their kids to look down on the masses because they're poor. This isn't true. What they're teaching their kids is to see the world through the eyes of objective reality; the way society really is.
Wealth brings privilege 3 of 8
Right or wrong, wealth offers privileges, and the sooner kids know it, the more likely they are to do something about it. Make sure your child knows this so that he/she is motivated to be financially successful and earn such privileges. When you dangle that carrot in front of the rabbit long enough, he's going to find a way to get it.
Money is earned 4 of 8
It's okay to help your children out financially, but giving them every dollar for everything only fosters a sense of entitlement. Help your children out, but encourage them by the age of 13 to find a part-time job, where they'll learn they have to earn money and not just expect it.
Money can grow 5 of 8
Teach your kids that saving is good, but finding ways to take their existing money and make more with it — whether through investment or entrepreneurial activities — is even better. The best way to make more money is to find solutions to problems. For example, people need their cars cleaned and their grass cut, and they're willing to pay others to do it for them. So have your children start a car washing business or a lawn service during the summer. You'll be teaching them to think like entrepreneurs, and the lesson they walk away with is "the more problems I can help people solve, the more money I can make."
Money is exciting 6 of 8
Money is something to look forward to. Teach your kids to look at it from a consciousness of freedom, possibility, opportunity and abundance, not something to dread or be frightened of. Encourage them to set their expectations high when it comes to money; you often get what you expect. If you expect to make $30,000 a year, that's probably what you'll make. But if you expect to make $500,000, you might not make exactly $500,000 but you'll be thinking big and in the right frame of mind to make a lot of money.
But … money doesn’t equal happiness 7 of 8
In many ways having money makes life easier: it gives you more opportunities, a comfortable quality of life, and it takes away the stress of "getting by." But it's important to let your kids know that money isn't everything. It won't make you a better person, and it won't make you happier. If you're not happy without money, you're not going to be happy with it.
Any child can strike it rich 8 of 8
Above all else, the most important belief parents can instill in their kids is that they are smart enough to earn all they desire. Regardless of their education level, IQ score, or performance in school, they have everything it takes to become a millionaire. No sweeter words were ever uttered from a parent to a child than "I believe in you" and "you can do it."