10 Things You Should Never Tell Your Kids About Money

As a parent, there are many lessons that you need to teach your kids. One of the big ones has to do with money. When they ask you for everything under the sun, you may tell them “money doesn’t grow on trees”. While that’s certainly the case and a lesson that needs to be learned, there are also plenty of other lessons they need to learn about the almighty dollar.

If you’re ready to take on “Kids and Money 101”, here are ten things you should never tell your kids about money.

#1: Never Tell Them Money Defines You

While money can certainly make paying bills and going on vacations a lot easier, it doesn’t define you as a person. Kids need to learn that at a young age. Money is an aid to get the things you need and want in life, but it’s not your entire life, nor should it be. Family, friends, and personal experiences are what help to define you. If your children can learn that lesson, they’ll be well on their way to leading much happier lives.

#2: Never Tell Them Money Buys Happiness

Speaking of happiness, it’s something money can’t buy. There are so many celebrities and business people who made plenty of money in their lives, but at the end of the day, weren’t happy people. Kids may look at their favorite singers and famous athletes, see them smile for the camera, and assume they are happy because they’re popular and make a lot of money. They don’t realize what’s going on behind the scenes. If your child believes money buys happiness, they’ll be truly disappointed down the road when they find out that it doesn’t.

#3: Never Tell Them to Live Outside Their Means

While we all may have a laundry list of “want” items, we know we can’t really afford them. Your children should learn the same. If you teach them to buy whatever they want, whenever they want, you’re only teaching them irresponsibility. Kids need to learn to live within their means. A good exercise to teach this is to let them take $10 out of their piggy bank and take them to the store. Go down the toy aisle and tell them to pick something out. Chances are they’ll pick out something that costs much more than $10. When this happens, explain to them that they only have $10 to spend and can’t go over that. Although they may not like the idea, they’ll soon learn that they can only live within their means and buy what they can afford. They can’t spend money they don’t have in their hand!

#4: Never Talk Incessantly About Money

Whether you’re always talking about how much money you have or don’t have, if your kids hear you obsess over it, they’ll also begin to obsess over it. While you don’t want money to be a taboo topic, it shouldn’t be the focus of every discussion. When you do bring up money discussions, use them as a learning tool to explain how bills are paid or how to balance a checkbook. This way, your money conversations are proactive.

#5: Never Talk About Your Salary

Your kids don’t need to know how much you make or which parent makes more money. A young child has no concept of what earning $50,000 a year means or how that relates to taxes and living expenses, so there’s no real reason to give them a dollar amount on your salary. Instead of sharing dollar amounts, you can talk about how to budget on a salary by using other numbers (not your actual salary or expense numbers). Make a list of expenses compared to how much money is coming in monthly. Show them that it’s simple math to add up all of your expenses and make sure it doesn’t exceed your salary. This will make it easier for them to understand that your salary is used to budget your money and pay for monthly expenses.

#6: Don’t be Secretive When it Comes to Spending 

If you went out and spent a good amount of money on something, but don’t want your partner to know, don’t tell your kids to keep it a secret. First of all, you really should avoid keeping money secrets from your partner. Secondly, teaching your kids to be secretive about money is teaching them to be dishonest, which is a big no-no. Don’t put your child in a situation that forces them to lie. Try to be honest about your purchases and keep your child out of the situation. This also teaches them that money is not a topic that should come with secrets.

#7: Don’t Talk About Your Debt 

If you have a lot of debt, don’t lay your financial troubles on your children. While they do need to learn that debt exists, they don’t need to know the specifics about your debt. Depending on their age, they may start to worry that every little thing you have to buy for them is contributing to your financial hardship. No child should have that burden on their shoulders.

#8: Never Tell Them to Shop Until They Drop

Taking your kids to the mall and telling them they can get whatever they want isn’t the best idea. They need to have limits and know what you can and can’t afford. Set parameters before going to the store. Tell your children you have a certain amount of money to spend. Once that is spent, the shopping trip is over. If you tell them to shop until they drop, they’ll think they can do that once that get older as well. We all know that is unrealistic as adults.

#9: Don’t Tell Them That if They Can’t Afford Something They Can Just Use a Credit Card

Credit cards can get people into a mountain of debt and financial trouble. Don’t let them think that credit cards can solve their problems and allow them to buy whatever they want, whenever they want. They need to learn that a credit card can help to pay for items, but that the bills need to be paid. When you don’t pay, the interest gets charged which forces you to pay more for the item than it’s actually worth. Interest rates are what get people in financial trouble and what lead them to find themselves simply paying off the interest and never getting to the original amount they charged. If you tend to use your credit card frequently, explain to your child that while you may use it, you also pay the bill every month to avoid high interest rates. Younger children may not grasp that concept, but older children should.

#10: Don’t Teach Them That Retail Therapy Solves Problems 

If you constantly talk about retail therapy and that spending a lot of money makes you feel better, they’re constantly going to think that’s true. It’s important to remember that kids learn their behavior from what they see their parents do. If they constantly hear you talk about how spending money makes you feel better about yourself or helps to cheer you up, they’re going to think that it will do the same for them. Instead of showing them that retail therapy cheers you up, find other ways to make yourself feel better that don’t involve money. This will not only help them but will also help you in the process.

Next Step

While there are plenty of things you should avoid telling your kids about money, there are plenty of things you should definitely be teaching them. If you’re looking for a way to instill the values of money management, let them start a small business with a Boss Club Business Kit. It’s the perfect choice because it comes with everything they need to start a business. By budgeting for materials to setting a price point, they’ll get to know everything they need to start learning about money. They’ll also learn what happens when you don’t budget correctly.

By giving your child all the lessons and tools they need, you’re not only contributing to the next wave of entrepreneurs, but you’re also teaching them about money management.