Good Money Values for Children

February 10, 2014

The first steps of family asset management start at home, as children are the greatest assets one can have. If children are not given the proper education for handling their financial affairs, the family will not survive beyond a generation. The “riches to rags” stories are all too common because, in general, very few parents communicated to their children the true value of wealth.

Feb+Blog+1+ImageEileen and Jon Gallo wrote The Financially Intelligent Parent: 8 Steps to Raising Successful, Generous, Responsible Children, which focused on the notion that spending patterns of parents and their own values regarding money have a profound impact on the values and priorities of their children. In fact, it helps to become more aware of the values that are being communicated to children by observing one’s spending. The spending patterns provide some splendid ideas about how to give children the message one wants them to receive.

Here are the key ideas that Gallos’ book and their blog try to convey to those parents, who want to utilize their way of communicating to children through spending habits.

Being a Charitable Family:
Teaching children generosity by volunteering time is always a good idea. As a parent, if you individually participate in service work as a volunteer, it is best to discuss what you are doing and for whom you are doing it. Also, try to find charitable work that you can participate as a family, including the children.

When the family receives charitable donation requests, discussing the goals of each charity with your children and asking their help to decide which charity should receive support will help them mature as givers. By introducing the ideas of service and giving, you can teach your children that they have the power to make life better for others.

Encourage Self-motivation:
On their blog, the Gallos refer to the book, Flow: The Psychology of Optimal Experience by Mihaly Csikszentmihalyi. Here the author focused on the idea that internally motivated people are happier than those who rely on external motivations. Based on that conclusion, the Gallos suggested that parents can help their children become happier as adults by relying less on external motivators, like paying children to do chores, and more on internal motivators, like using chores as a means of helping children gain self-respect and take pride in their work.

Developing Work Ethics in Children:
To children, school is considered as work! Hence, it is important to convey the message that it is better to “do their best” at school rather than focusing on “being the best” student. Besides school and homework, children should be given regular responsibilities in household work. When they become older, they should be encouraged to take on part-time employment to understand the value of labor. Experiencing work will certainly help children connect the value of money to labor. This will help them become more respectful to the notion that all work is valuable.

As children learn values by observing how their parents assign values of money and how they treat others, it is important for wealthy families to teach children that money is only a tool. It is something they have, and not something they are. Eventually, this will help them understand the difference between their net-worth and self-worth.



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