On Kids and Cash and the Importance of Not Bailing Them Out
Last week I had just sat down at my desk to finish a story that was due in a couple of hours when my phone rang. ‘Mom,’ said my 10-year-old daughter in a small voice, ‘I forgot my project at home.’ Her project. The one on the San that she’d been working on for the past two weeks which she had finished a whole seven days ahead of deadline and proudly shown to her friend the afternoon before. But her school is a 40 minute round-trip and I was on deadline and she’s big and needs to be remembering this kind of stuff herself. ‘Darling,’ I said, ‘we live far away. I’ve just sat down to work. I can’t bring it to you now.’ ‘Okay,’ she replied, and we hung up. I tried to write, but I couldn’t concentrate. I was thinking about earlier that morning and how she couldn’t find her school shoes because, unbeknownst to us, her friend had taken them home by mistake and we tore the house apart and I told her off for not being more organised and then I thought about what her favourite teacher would say to her when she showed up empty-handed. I put my Uggs and my coat back on and drove to the school and knocked on the door of her classroom and when she saw me her eyes filled with tears and she said, ‘I knew you’d come, mom.’
And I felt like I’d done the right thing because that morning she’d been thrown a curve-ball and she’s pretty good, generally, with being independent, but it reminded me of how the hardest – and sometimes most important – part of parenting can be letting your kids learn stuff the hard way. Because you want to protect and shelter them as much as you can, but it’s not always the way to help them in the long run. Their school has a great policy around this, and it’s one I totally agree with. The headmistress said to us parents on the very first meeting we had, ‘when your kids forget their lunch at home, don’t rush out and bring it to them. It’s really, really important that they learn to take responsibility in some areas of their lives. They won’t starve, their friends will share with them. But they will remember next time.’ And it’s something I’m very mindful of, especially when it comes to money, because I had the kind of mom who loved me so much she bailed me out all the time, and I went off into the world completely clueless about how to manage my finances and overspent horribly on my student loan and then rang up a big, fat account at a clothing store which was happily charging me 25% interest, and because I had never been held accountable before, I vaguely assumed these problems would all just go away.
Well, they didn’t, and this I learnt the hard way. Because the thing is, your parents can bail you out for a while, but after that – unless they’re really rolling – you’re pretty much on your own. And the world out there is harsh and unforgiving in that regard. Unless you prepare your children for this eventuality, and teach them about the value of money and how difficult it is to come by they’re going to learn these lessons too late, like I did. And I know my mom meant well and would still move mountains for me, but I understand now that really loving your children and parenting them well means gritting your teeth sometimes and letting them take the rap for making bad choices. Some people are ‘money people’ who count it and save it and make it work for them, and others – like me – see it as a necessary evil which I’d rather not ever deal with or think about particularly, and it took me till I was well into my thirties to stop treating my bank statements like spam and understand that money is one aspect of life we all have to deal with whether we like it or not.
Which makes it even more important that I educate my daughters in ways I wasn’t so that they will go off into the world as young adults making better choices than I did, and understanding that there is no running away from debt; it finds you and it klaps you in the end. How exactly I’m going to do this I haven’t quite figured out and they’re still pretty young, but what there definitely will be is dialogue around the issue of money and where it comes from; pocket money which depends on the completion of certain chores and, if I have to nag one too many times about the dishwasher being emptied there will – in theory, anyway (I haven’t quite been able to pull this off) be deductions happening. My eldest has a certain amount of airtime on her phone which has to last the month, and (with varying levels of success) I encourage her not to blow her birthday spoils on Loom Bands, but to save it for something she really wants.
I believe a big reason why my husband is so on top of stuff financially is because he had his first job at the age of ten which was on a farm picking onions. There were five kids in his family and one parent working and while I just had to ask if I needed something, he had to work for pretty much everything extra. And I know what a sense of accomplishment he felt when he was able to buy himself his first wetsuit, his own stereo and take himself and his mates to the movies. And I believe that the grounding he received – working, earning and saving – was an invaluable life lesson and laid the foundation for sound financial decisions later. Not to say kids should be sent to the salt mines, but when I first started earning my own money in my early twenties I had a lot of catching up to do regards the logistics of spending and saving. So, I think the most important thing – even if you don’t have a precise plan in place – is to be aware of these issues, and understand how important it is that your kids get it and putting your need to protect them aside every once in a while in order to fulfil their need to learn about responsibility and accountability.
And it’s hard, hard, hard when they’re in a shop and they’re R20 short of the thing they want to buy to stand there and watch them put it back on the shelf till next week when they’ve earned their next installment of pocket money. Every instinct wants to give them what they want, but what they need, at that moment, is to not be able to afford it till next time. They need to wait a bit and unpack the dishwasher and think about the thing they saw and anticipate owning it and count their pennies till they’ve made up the difference. And you need to give them that opportunity. Teaching them how to survive without us is possibly the most important – and challenging – lesson we’ll ever impart to our kids. And allowing them to manage their own little financial affairs really helps equip them for this task.
Authored by Susan Hayden
If you want to read more of what comes out of Susan’s self-confessed “big mouth when I write”, then pop over to her awesome discopantsblog where she has some more opinions on everything from food and coffee to parenting and relationships, and a bunch of stuff in between.
Pocket money is (un)common sense
I don’t know about you, but growing up in my house meant doing chores. And those chores didn’t always come with the sweet payday I saw some of my friends receiving. No, when we got pocket money, it was for going above and beyond the normal call of duty.
Would I have liked getting pocket money for making my bed? Sure. Would I have been better or worse off if I had? Who knows? I guess that teaching your kids about money is like a lot of other aspects of parenting: you don’t know if you’re doing the right thing. Well, here‘s some conventional and unconventional wisdom on pocket money that may help.
Money for chores, not money for nothing.
To give or not to give? Common sense says give pocket money, right? Surely some is better than none. Well, maybe. Then again, according to one study, pocket money may actually lower the chances of a child saving money, at least compared with kids who have part-time jobs. So perhaps the conclusion is to give your kids pocket money, but to make them earn it. Teaching kids the value of money through chores – and, when they get older, through actual paid work – may set them up for a better financial future.
Are your kids old enough for pocket money?
Most resources suggest introducing pocket money when kids are about seven. This is around the time they start school and are first learning basic maths concepts (you have two apples, if you take one away you have one left… sort of thing). Pocket money can be a great aid in this area.
Increasing the amount of pocket money as they get older is also a good idea: the needs of a 10 year old vary considerably from those of a 17 year old. The general age bracket breakdown is 6-8, 9-12, 13-15, and 16-18.
How often is more important than how much.
There are opposing opinions on this. One says give your kids a weekly or monthly allowance. (Weekly for younger kids because time lines are shorter and easier to understand, then move to monthly as they get older and more adept). The thinking is that a consistent allowance helps kids learn to pace their spending and enjoy the rewards of delayed gratification.
On the other hand, Cameron Herold’s view is that a weekly or monthly allowance teaches kids to think about a regular job with a regular salary, instead of encouraging entrepreneurship. Herold thinks kids should still work for their pocket money, but get them to look for chores and pay them per chore. That way, they’ll become more enterprising and look for opportunities. Taking it a step further and negotiating what each chore is worth will teach them other valuable lessons about value and supply and demand.
Save some for a rainy day.
It’s tempting for kids to go on a spending spree as soon as they get their pocket money. The best time to teach them about saving is now. Explain the difference between splurging right away and then having nothing left, and spending a little now while saving up for something special in the future. Piggy banks and, for older kids, savings accounts will help them see their treasure growing.
Let them make mistakes.
You may be tempted to stop your children from spending all their money on bubble gum. You may want to bail your kids out every time they run out of money. Don’t. While traditionally we may have been taught to avoid mistakes, recent thinking says we should embrace failure. Mistakes are valuable. They’re a great way to learn. And it’s better that these mistakes happen now than in 15 years, when there’s a lot more money at risk.