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Kids And Money, Money And Kids (And So It Goes)

Posted by: Trust Company of Illinois

Jun 25, 2012 11:25:00 AM

Being a father of four children and an advisor to successful families gives me a unique perspective.   Through time I have come to realize I share many of the same ideals as my clients.

I have worked with families on both ends of the spectrum.  I had a client a few years ago who used an entire inheritance to double the size of his house at the peak of the housing boom, creating a Cadillac house on a Pinto income.

And I have dealt with a family patriarch, a man worth over $100 million,  who always took doggy bags in restaurants and wore wool ties "because they last longer."

My experience is that parents who live within their means raise kids who do the same.

I have always believed in the adage that money does not change people.

It just exposes them.

Money is about choices, at any age.

It's never too early teach your kids about money, whether piggy banks for toddlers, bank accounts and allowances for grade schoolers or financing a college education.

A few memories stand out:

When my twins were young (they are now 14) I had a clear piggy bank on my dresser for pocket change.  Each time it filled, we would go to the bank, count it and they could split the money.

At restaurants, I offered my kids a choice between a soda or a dollar.

And I gave them an allowance at an early age.  As they grew older I paid them a combination of "fee for service" for big ticket chores along with a regular weekly sum.

I was pleased with their independence, if not (always) with their choices.  For example, one Christmas they pooled all of their assets  in order to buy an elaborate video game system, leaving little money for more than a couple of games.

Besides that fact that I loathe video games, it was a lesson that with financial decisions come consequences.

In church I used to be in the habit of letting my kids put an envelope in the collection plate, even after switching to automated contributions.  That is until the Sunday when I gave my son a (purposely empty) envelope, at which point he held it up to the light, stood up and shouted, "Dad, there's nothing in here!"

What lessons do you teach your children about money?

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Topics: Wealth Management


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