This blog post is testimony to the huge influence that young children have to driving us into deep debt. … Oops, I mean on our spending decisions. No, really, I mean on driving us into deep debt.
It is a fact that during the parenting years, most people are deeper in debt and more likely to need credit counseling than before and after kids, and that disposable income is at its lowest. Let’s face it, kids are expensive.
But we can exercise some discipline to ease the pain, and at the same time teach the children some valuable money decisions.
Spending money is about making choices. What you spend on one purchase is no longer available to spend on another purchase. The money is gone. You are left with a toy, a shirt or a memory. The money is no longer there to buy another toy or another shirt or another memory. You can still make memories, but not in a theme park.
If you as an adult have mastered this concept, you can teach it to your kids. However, if you have run up huge credit card debt, you are obviously spending more money than you have. No problem. You can learn this lesson together with your children.
Set yourself a budget. You don’t have to do this with your kids; they won’t understand all the things you need to pay for. But when you go to the grocery store, you can certainly explain to them how much money you have allocated for this shopping trip, and have them add up the cost as you fill the basket.
They might not agree with all of your choices (“No mommy, buy the cupcakes, not the chicken. Cupcakes are yummier.”), but over time they will come to understand about making choices. They will understand that if you buy chicken instead of beef, you can also buy a dessert. And that is what budgeting and managing money is all about…
The grocery store is the easy place to teach about money on a daily basis. But closer to their heart will be when at the amusement park. Do you buy them ice cream and cotton candy and other treats? Do you buy the overpriced junk food meals? Or do you make your own meals and maybe allocate funds for one special treat? Let them help you decide. If they choose the meal at the amusement park, withhold from them something they really want.
“Sorry, we spent that money on the meal. Next time if we bring our own meals, we’ll have more money available to buy other things.”
And after leaving the park, you can do the same.
“Sorry, we spent that money at the theme park. Next time if we don’t spend as much, we’ll have more money available to buy other things the next day.”
What counts is not the exact amount of money. What counts is that children learn to make choices and to think about what they might be giving up later on before making an expense today. Hopefully they will manage their money better than we do. And hopefully, if we teach well, we will also learn well… and manage our money better than we did.
This is a guest post from Consolidated Credit. If your debt load has become too heavy burden because of kids or for any other reason, you can reach out to them at www.consolidatedcredit.ca.