What is the American Dream? One part is the hope of making a good life for yourself.
Another big part is this: To create a better life for your children.
That’s what motivated the generation born in the Great Depression to scrimp and save to send their kids – the baby boomers — to college. But the baby boomers have morphed the dream in a different direction — determined that their children would not know the privation and struggles they’d witnessed.
And so today we have about 42% of our population under the age of 30 – and, with it, a generation of middle-income children who have grown up with an enormous sense of entitlement. In their quest to ease their children’s lives, many of these baby-boomer parents have inadvertently denied their children the challenge of achieving financial goals and the joy of surmounting obstacles.
And what this means is that a lot of kids just don’t get it when it comes to money.
Respect For Money
So what can we, as parents, do to create money-smart and motivated kids? We can start by helping our kids sort out and understand the blizzard of messages we send to our children. Two-year-olds recognize television commercials and demand the toys and snack foods that are cleverly marketed to them. Toddlers in a grocery cart watch while Mom inserts a piece of plastic — and money spurts out! Late-night arguments between parents over unpaid bills send strange signals to children.
We can try to find new ways to celebrate old-fashioned money virtues. If parents treat money with respect, watchful young eyes learn. I still remember mom forcing me to pick up a nickel I’d dropped in a muddy gutter along a sidewalk.
You teach kids about money through such tools as allowances, letting kids work for money and introducing them to investing. But as you do those things, keep two key points in mind:
- Your children are individuals. Some will grasp the lessons, others won’t. You’ll just have to accept that the motivational techniques that work with one child may not have much effect on another. Still, that’s no reason not to give it a try.
- As parents, remember: you’re in control. It’s a truth that’s not always obvious. Don’t fall into the parent trap of giving in to your kids out of fear, guilt or pure indulgence. Every family needs at least one adult, and that person should be you!
Chuck Chuckuemeka is managing partner of Chuckuemeka & Associates, a nationally focused CPA firm specializing in Accounting, Auditing, Consulting and Tax Advising. Visit them at www.chuckcpa.com