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5 Ways To Teach Good Money Habits To Your Kids

5 Ways To Teach Good Money Habits To Your Kids

For most adults, the first meeting with money management comes in the form of a coin collector box. You remember getting a buck from family after a task or doing a good deed and putting it in your piggy bank.

Did you know that kids as young as three years old can understand the theories of spending and saving? Not only this, but their money habits are typically set by the age of seven, according to a study by the University of Cambridge. As per the report, parents have the biggest influence on their children’s money-management habits. Consequently, the teaching of financial responsibility by parents should not stop with the piggy bank, as they are the first influence on their child’s financial behaviors. Teaching some good money habits to kids can save them from making some major mistakes in the future. The economic crisis indicates that every parent should start developing good money habits in their kids (from the age of three) to establish a well-founded financial base.

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Here are some important lessons about money that we should all impart on our children to help them take control of their financial futures.

1. Model good financial behavior

The first and most important thing to keep in mind is that children have a tendency to do what their parents or their elders do. Children are very observant, and often adopt and soak in many actions simply from watching their parents. Therefore, parents should model good financial behavior by showcasing positive financial habits and philosophies on a daily basis. This includes things like shopping on a set budget, using coupons and discount offers to pay less for goods, and making choices between new and used baby accessories, which can all make a huge impact on savings. Do your research to demonstrate the opportunity costs involved, and talk about money management.

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2. Save for the future

The concept of saving to build a successful financial foundation is very common, but it can be difficult to implement as kids quickly become attracted to the latest items on the market.

Open a savings account for your child to which they contribute each week. At the end of each month, show them the monthly bank statement — this will motivate them to save more from their weekly pocket money. This is the first baby step toward setting your child up for a lifetime of good financial habits.

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According to a research by the University of Wisconsin-Madison, even preschoolers can learn basic financial concepts.

3. Involve them in shopping and budgeting

You can help your kids to learn constructive money habits by involving them in your weekly household goods shopping and in creating monthly budgets. During visits to grocery store and other shops, let children take charge of the shopping lists. Encourage them to choose the best products with value and use this situation to discuss spending, saving, planning, and more. Budgeting should be a part of yours, as well as your kid’s, life. The development of successful personal finance hinges on budgeting. Train kids to budget for every little thing.

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4. Let them wait to buy something they want

This is the hardest lesson for every age group to learn, especially for teenage children. Parents should assist them in choosing things that they really need. Extra expenses will make them devalue the amount of money given to them.

“Money doesn’t grow on Trees” — this is the guide that every parent should use to raise financially responsible children. At an early age, kids need to learn that if they really want to buy something, they have to wait and save to buy it. Money lessons at this age set the tone for their future. Make them understand that going into a store doesn’t always mean you will buy something.

 5. Let them make mistakes

Even if you believe that your child is about to waste their money on a toy or game they will be soon tired of, let them buy the item, because it might just teach them a lasting lesson. They will feel like they wasted money ​on toys they enjoyed only one or two times and will remember this in the future. So, let the kids do the work themselves, let them make mistakes and have fun. Explain how you learned from certain missteps in your own childhood.

Featured photo credit: studio-r via studio-r.biz

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Tayyab Babar

Tayyab is a PR/Marketing consultant. He writes about work, productivity and tech tips at Lifehack.

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Published on December 20, 2019

Is Authoritarian Parenting Good or Bad for Your Child?

Is Authoritarian Parenting Good or Bad for Your Child?

Kate sits down to the dinner table and is eager to be a good girl and eat her dinner like her Mom and Dad want her to do. She is a sweet girl who wants the approval of her parents very much. It is not always easy though. During dinner, she stands up and starts to leave the table because she has to use the bathroom. Her Dad yells at her to sit back down. He tells her “we don’t just get up from the dinner table, we wait and ask to be excused after everyone is finished eating.” She begins to protest, wanting to explain that she needs to use the bathroom. Her father becomes more upset with her and yells at her that she is now talking back and she is not allowed to say another word at the dinner table until everyone is finished eating and then she can be excused.

Unfortunately for Kate, she can’t hold it, and she has a little accident because she is too fearful to say a word to her Dad. She doesn’t want to get yelled at anymore. She also knows that in her home, kids don’t have a say. What Mom and Dad say is like words carved into stone. They are strict beyond reason and they will not bend their rules. Therefore, Kate felt that she had no choice in the matter and when she could no longer hold it. There was nothing she could do about it.

Kate’s parents are an example of authoritarian parenting. They are strict, they are not emotionally engaged with their children, and they have very high expectations for their children. This type of parenting style leaves children feeling disconnected from their parents.

Kate wanted to communicate to her parents that she had to use the restroom, but she couldn’t even get her words out because her parents have such strict rules and demands of her. They did not care to hear what she had to say, because upholding their rules was more important to them. In their household, a child’s opinions and feelings do not matter.

This kind of strict parenting is not helpful for children. It can damage a child and leave them with low self-esteem, mental health issues, and doing poor academically among other problems cited by research in Parenting Science.[1]

What Does Authoritarian Parenting Look Like?

In the 1960’s, a researcher and theorist by the name of Baumrind established the well known theory of parenting styles. Those four parenting styles, which are well known today, are authoritarian, authoritative, passive, and neglectful. For proactive parents that are trying hard to be good parents, they will usually lean toward either authoritarian or authoritative.

Authoritarian parenting involves strict parenting and high expectations for children. This can sound reasonable and even like good parenting. However, the strict parenting is often characterized by lack of compassion toward the child, little to no flexibility in rules, and complete control sought over the child’s behavior.

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Parents who use this parenting style believe it is their job to control the will and behavior of their children. An article in Psychology Today explains how authoritarian parents operate:[2]

Authoritarian parents believe that children are, by nature, strong-willed and self-indulgent. They value obedience to higher authority as a virtue unto itself. Authoritarian parents see their primary job to be bending the will of the child to that of authority—the parent, the church, the teacher. Willfulness is seen to be the root of unhappiness, bad behavior, and sin. Thus, a loving parent is one who tries to break the will of the child.

For example, Jake has authoritarian parents. He wants to stay out past curfew on a school night because he has an opportunity to play in a jazz ensemble. He has been playing the saxophone for years and his ambition is to play in a college jazz ensemble.

With Jake still being in high school, his parents have a curfew. On school nights, it is 8:00 pm. This rule is instituted because his parents believe they need to ensure that Jake gets his school work done each night and that he needs to be well rested for school the next day. However, they don’t explain the why of their rules to him, they simply tell him that those are their rules. The jazz ensemble is practicing at 8:00 pm on a Thursday night and they have invited Jake to come play with them. It is a well known group and a huge opportunity for Jake.

Unfortunately, his parents say no. Their authoritarian parenting style is unwavering. He wants to discuss the opportunity and its importance, but his parents will not even entertain the conversation. They stop him mid-sentence and go over their rules again. There is no flexibility.

If Jake’s parents had been authoritative, they would have taken the time to hear out his case and would likely have granted him a later curfew for that one instance. They would see that, although they have a curfew, there are some instances when an opportunity is worth bending the rules. They would ask that he has his homework done before going to play with the group, and that he come home as soon as the practice was finished.

Authoritative parents have rules, but they are also flexible based on reasonable requests for exceptions. The authoritative parents are interested in how their children are thinking and feeling. Conversely, authoritarian parents are not likely to be interested in hearing their child’s thoughts and feelings, because they want to control the will of their child, not come to some middle ground.

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Here are some characteristics of authoritarian parenting:

  • They have strict rules that are unyielding and unwavering. This is often called “heavy handed parenting.”
  • They do not want input from the child about rules. They also feel that the child’s opinion does not matter, because they are the parent thus are the supreme authority over the child.
  • There are severe punishments when rules are broken.
  • There is an emotional disconnection between parent and child, because the parent is not interested in what the child thinks or feels. They are more interested in controlling the behavior of the child and having the child be compliant to their rules.
  • Children are expected to listen to their parents and follow the rules, there are no exceptions. A child that voices their objections will likely be punished for doing so.
  • The parents have high expectations, especially when it comes to compliance of their rules.
  • Parents expect that their child will be obedient and they do not need to explain the “why” of their rules and expectations. Compliance is expected out of sheer obedience, not because the child understands the reasons why the rules are set. Parents do not feel the need to explain why they set their rules.
  • There is a failure to have attached relationships between parent and child because of the overly dominant nature of authoritarian parents and their unwillingness to allow their children to have their own voice or free will.

Authoritarian parents are driven by a belief that they need to control their children. This means controlling their children’s behavior to an extreme. They are inflexible and don’t take into account the child’s desires, emotions, or well-being as being as important to enforcing rules to get the desired outcome. Authoritative parents on the other hand, seek to guide and direct their children instead of control. There is a distinction.

The Problems of Authoritarian Parenting

Authoritarian parenting has many negative consequences to children. Children who are raised in homes with extreme authoritarian parenting are more likely to become dependent on drugs and alcohol, have lower academic performance, and increased mental health issues according to Parenting for Brain.[3] Children who are raised with authoritarian parents are also more likely to have lower self esteem, inability to make decisive choices, and have social skills that are lacking.

When a child is raised to be taught day in and day out that their voice does not matter, then that child will likely be ingrained with that belief. They will not value their own opinions because they have been taught that what they think does not matter and is of no value. This leads to poor self-esteem and low self-worth.

If a child doesn’t believe that their thoughts matter, then what they think about themselves overall is going to be affected. They will not think highly of themselves or believe that what they think, say, or do is of value. This will contribute to low self-esteem long term.

Social skills will suffer because a child who comes from an authoritarian home will be trained to believe that nobody wants to hear their opinion and that relationships are based on compliance.

For example, Judy is raised in an authoritarian home. She is now 18 years old and has her first boyfriend. Anytime that he asks something of her, even if she internally disagrees, she feels that she is supposed to comply and do what he says in order for him to like her and continue wanting to be with her.

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He wants to have sex. She does not feel that she is ready, but she will not voice this to her boyfriend because she doesn’t think that her opinion will matter or that he will want to listen to what she is feeling. She goes along with sex in their relationship to be compliant. She doesn’t want to be punished by disagreeing with not having sex. He says that they are ready for that next step in the relationship and she fears that the consequence of saying no would be that he ends the relationship.

Therefore, she doesn’t even voice her thoughts or feelings on the situation because she doesn’t think they have value or will be heard anyway.

She has been taught by her parents that her opinions and feelings don’t matter. She has learned from the past 18 years with her parents that what matters most is that she is compliant. She gets along with her parents best when she is doing exactly what they want her to do. This is why she feels the need to do the same with her boyfriend.

Going along with his decisions, being compliant, and not voicing her feelings will keep the relationship going and avoid conflict or punishment. The ultimate punishment in her mind would be that he ends the relationship.

With her opinions never being valued by those who she has loved the most (her parents), she has learned that she should not voice her opinion if she wants to keep the other person in the relationship happy. In her mind, because of how she has been raised, compliance overrides all else, and her opinion is meaningless.

However, her boyfriend is not her parents. He is understanding and would want to know how she feels. He wants a long term relationship with her and he loves her so much. His true desire is for her to be happy. He would never want her to have sex if she wasn’t feeling the same way that he was feeling. He would gladly wait and would want to hear what she thinks and feels about taking their relationship to the next level.

Authoritarian parenting methods can inflict great harm on a child. The child becomes emotionally damaged because they grow up believing that their opinions, thoughts, and feelings do not matter. Instead they are taught that compliance and being obedient supersedes all else.

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The Solution

The solution is to move from authoritarian parenting methods to authoritative parenting practices.

Authoritative parenting has been deemed as the best parenting method by researchers, according to Psychology Today. Parents who use authoritative parenting methods have rules for their children, but they are not looking for blind compliance. They recognize that having a relationship with their child is of great importance and therefore valuing the child’s voice, opinions, and thoughts is important.

Authoritative parents seek to guide and direct their children, but they do not seek to control the will of their child.

Parenting Coach Plan explains the foundation of authoritative parenting as the following:[4]

Authoritative parenting can be described as a style of parenting that combines firm limits and clear boundaries with fair and consistent discipline. Authoritative parents are also nurturing, highly-involved, and willing to speak openly with their child regarding expectations and the consequences for failing to meet those expectations. Rules are enforced and fair consequences are put in place for when those rules are broken.

Children raised in authoritative homes follow the rules because they understand the “why” of the rules. They are also bonded to their parents because they are able to talk to their parents openly. This bond helps nurture a positive home environment and a two-way relationship that can last a lifetime.

To learn more about how to be an authoritative parent and how to discipline a child using this parenting method, check out my article:

How to Discipline a Child (The Complete Guide for Different Ages)

Featured photo credit: Xavier Mouton Photographie via unsplash.com

Reference

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