How Parents Impact Their Children’s Financial Future
It amazes me sometimes, as I write about financial topics, how changing behaviors have impacted the way we view money. Some are positive changes, like the increased awareness of the importance of saving for retirement. But the most troubling signs have to do with changes in how children are being raised and the negative impact these changes will have on their ability to successfully attain the American dream, if our society doesn’t make some quick changes.
What Determines Financial Success?
We raised our family in a time when the culture around us was rarely a factor in our decisions. Sure, there were people who worked hard to keep up with the Joneses, but most simply wanted to meet the needs of their family, while helping their children grow into responsible, caring adults. We knew the difference between a necessity and a desire and handled our finances to insure that our needs were met before our wants were even considered. That was success.
By today’s standards, those old expectations and desires were simple. In comparison, families today have a host of things they expect to accomplish or own that they use to gauge how well they’re doing as parents. For example, how can a family not make at least one trip to Disney World? And what about the push to have an elaborate, posh birthday party every year that entails hiring a magician or renting a roller rink?
In addition, if parenting ideals are met at the expense of financial security and increased debt, you’ll be teaching your children that you get what you want at any cost – a really bad lesson.
Now I’ll grant you that having the means to provide all your desires for your family is in itself harmless and may bring a great deal of happiness. But when there is an unrestrained need to please and boundaries go unchallenged, the next generation may be straddled with an inability to manage money.
Two factors that I believe will lead children down the road to a hard financial life…
1. Praising Mediocrity
Our culture teaches that there should be no losers, and if we’re not careful, children will not have the tools to handle loss or negative situations. Having a celebration for a mediocre accomplishment skews what a real achievement looks like, while encouraging a child to be proud of an all-out effort is how you build self-esteem. Handing a trophy to every player in a league devalues the effort needed to succeed. Why would we expect our children to strive for the rewards in life, if they’ve never learned that failure is what makes us try harder?
2. Not Teaching Responsibility
Catering to their every need and jumping in to defend their every action teaches dependence. Every child should have non-paying responsibilities that send the message that they’re responsible for pulling their own weight as part of the family unit. An allowance should only be given for extra work, not daily chores. The old clichÃ© that you can’t get something from nothing is an important lesson for children to learn. Responsibilities should increase as they grow older to help them transition into adulthood. In the same way, kids need to learn to take responsibility for their battles, to fend for themselves.
We all want our children to grow to be independent, mature adults. This will only happen if they’ve been given ample opportunities to be tested. To teach them that they can do things on their own means you love them enough to guide them, even when it’s hard
About The Author: As a freelance writer for popular finance blogs and websites, Noreen Ruth provides readers with the most up-to-date information on credit and other financial issues. Her goal is to educate consumers about topics that may impact their ability to manage their credit/debt responsibly. Noreen shares tips on how to build credit, review student credit cards, compare credit card applications, manage credit debt, apply for debt reduction help, etc., in addition to reporting on the latest credit and debt news from government and other reputable sources.