Paycheck Chronicles

Military Saves: Family Savings Day

Today's focus for Military Saves Week is talking about money with your children.  Many people find this hard, but I believe there are appropriate ways to discuss money with every age of child.  Obviously, most of us want to shield our children from financial stress, but there is some level of sharing that is appropriate for every situation. Talking about saving is usually not stressful, so that part is easy.

We have four kids, who are now ages 19 to 14, so I have a little experience talking with children about money.  Of course, the fact that money is my job gives me a little extra opportunity to introduce the subject, but general family life gives plenty of ways to slip in a little financial wisdom.

Talk to your kids about the choices you make with your money.  Even the smallest child can understand choices.   You might explain that you don't drive a fancy car because you prefer to spend that money to visit Grandmom and Granddad every summer, or that you buy your clothes from the thrift shop so that you can save your money for a trip to Disneyworld.  It doesn't have to be a big deal, or emotional, just the facts about the choices that you make.

As they get older, you can start sharing portions of your budget and how their expenses fit into that budget.  For example, you might share that you have a certain amount of money that can be spent on their sports or other activities.  This encourages them to prioritize the things that have value to them, and not sign up for a bunch of stuff just because it looks fun.  Again, there can be a savings aspect to the conversation, especially if they do something expensive that is seasonal.  "We have to put away $XX each month from our activities budget to pay for summer football camp."

In a perfect world, your child would have some experience with your entire family spending plan before heading off to college.  Many people find it uncomfortable to open up the entire family financial situation to their teens, so this is obviously on a case-by-case basis.  A little bit of discomfort, however, is probably worth the overall learning value of the exercise.  Again, this is a great time to emphasize savings.  With teens, I like to point out how MY saving for retirement means that I'm not going to be THEIR problem when I'm older.  (Let us hope this works out.)

Talking with your kids about money is important, but it's essential to point out your bad money habits and make sure that your kids recognize that they're not good.  We all have them.  Whether it's not saving for vehicle repair and purchase costs, to tapping your emergency fund when it's not an emergency, or overspending on a category that you don't actually value, revealing your failures is a much larger learning opportunity than revealing your successes.

Today, grasp any opportunity to sneak a little money talk into your conversations with your kids.  The more you do it, the easier it is.  You'll be helping your family now, and for generations into the future.

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