Q&A Of fear and fortune

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I grew up in a house where my father’s fortunes changed from year to year. One year we’d be rich, and the next poor. This has left me with psychological issues about money; that it is somehow magical and uncontrollable, and I also suffer from a huge need to feel financially secure, which on paper I am, but in my heart I don’t feel. How can I break the cycle and raise my own children to have a healthy attitude towards money, as I don’t even know what that looks like. I’m not looking for finance tips… more the emotional stuff.

MADELEIN ANSWERS: Our beliefs around money – both conscious and unconscious – are mostly formed by what we learn, experience and observe as we grow up. Children are not born with “money sense.” As they grow, children are constantly watching, listening and learning about money. How much does an ice cream cost? Can I buy a new toy with my money? What do Mom and Dad do with their money? How do Mom and Dad talk and feel about their money? Children do not learn from spoken words, they learn from behaviours and observation. Three major inputs shape attitudes about money – childhood experiences, parental behaviour and the micro environment in which money choices are made by the household. So how you deal with money and your attitudes about money will undoubtedly influence how your children manage their money as adults.

So how does one speak, think and act – to enable a healthy money attitude in our children? Here are a few guidelines:

1 FIRST, TALKING WITH KIDS ABOUT MONEY IS AS IMPORTANT AS TALKING WITH THEM ABOUT STRANGERS AND DRUGS.

Do not avoid the subject because of your past and the anxiety you experience regarding the topic. Discuss money issues with your kids on an ongoing basis. That is not to say that you should burden your children with money issues or inform them of your precise income or debt, but rather that you should create opportunity to discuss money and family financial decisions with your children. Talk about the things that family members work to pay for, such as food, clothing, housing or rent, vehicles or household necessities.

2 HELP YOUR CHILDREN UNDERSTAND (AND TAKE PART IN) MONEY DECISIONS.

Letting your children know that the budget for the birthday party is a given amount will help them make choices about how to spend it. Children pick up the threads of conversations as you discuss the options, and allowing them to participate helps them see how to make choices.

3 TEACH YOUR CHILD THAT MONEY CAN HELP CREATE FREEDOM AND OPTIONS.

Rather than giving your child the sense that there’s not enough money, help them see that it is about making conscious spending decisions, spending less in one area, so that they can do something more important. In this way, you are showing your child that money can help create freedom and options. For example: “I can buy you the toy you like, but it means it will take us longer to get the tent for our holidays”.

4 SET AN EXAMPLE.

If you and your spouse are arguing about money, they’ll notice that. If you often complain that you are stressed about your budget, you will project your anxiety about finances on them – and they will be repeating the cycle when they are adults dealing with their own money.

5 INVOLVE THE CHILDREN WHEN THE GOING IS TOUGH.

Let them know sacrifices are needed. But try and make it fun. When it is dress-up day at school, and there’s not enough money to buy expensive costumes, let the children create interesting and funny masks using recycled materials and art supplies at home.

6 GUIDE AND SUPERVISE, RATHER THAN DICTATING.

Let your kids do things themselves. Let them make their own purchases with the money they have, whether it’s birthday money from grandma or money they’ve earned through special chores. Offer advice, but let them do it themselves.

7 LET THEM MAKE MISTAKES.

Along the same vein as giving up control, letting your kids make mistakes is part of teaching them. They’ll learn from it, you can talk about it, and they will think twice next time. Set limits to keep their mistakes limited to small-scale lessons.

8 PRAISE RATHER THAN CRITICISE.

Compliment your child’s positive efforts, and don’t be over critical of mistakes. You then become your child’s ally and not his enemy.

9 DON’T USE MONEY TO REWARD OR PUNISH.

Children should learn to take responsibility for their school grades and behaviour. Family chores like cleaning your room should be expected of all family members, including children.

10 WORK TOGETHER AS A TEAM.

Family members should agree on how income will be used, set financial goals, plan how to reach their goals and work together as a team. Planning helps the family use money more effectively. This will help your child feel part of the process and in control – which is needed for creating a positive association and relationship in managing money.

11 STRESS THE IMPORTANCE OF GIVING.

Once your children start making a little money, be sure you teach them about giving. They can pick a church, charity or even someone they know who needs a little help. Eventually, they’ll see how giving doesn’t just affect the people they give to, but the giver as well.

There is no rule book to parenting. We all do the best we can. Being a selfaware parent is already the first step to improving on negative patterns you learnt as a child. The consequences of how children learn about money are vitally important for their life, happiness and future. Helping them navigate their relationship with money may be one of the most important lessons you can teach them. ●

HOW YOU DEAL WITH MONEY AND YOUR ATTITUDES ABOUT MONEY WILL UNDOUBTEDLY INFLUENCE HOW YOUR CHILDREN MANAGE THEIR MONEY AS ADULTS.