One of the scariest questions I can ask a single parent is "Do you want your children to have the same level of financial confidence and ability as you?" Their eyes widen in horror as the realization hits them: they are the fiscal role-model for their kids.
Will Your Children be Rich or Poor?
| Author: Stuart Fleming | Posted: 06/21/09 | ||
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A friend of mine has one son at primary school. Recently his class had a ‘careers day’, with several parents visiting to share how they earn a living.
At dinner that night the boy took great delight in telling his father what he had learnt about the role of a doctor, a fireman, a lawyer, an accountant, a sales rep and a computer technician.
His dad smiled and agreed that there were lots of jobs to choose from, but inside he was puzzled: not one of the adults who spoke to the class were self-employed.
When he mentioned that detail to the teacher the next morning, the response was one of pure surprise. “Goodness, you’re right!” exclaimed the teacher. “I never even thought about self-employment as an option!”
Are you exposing your children to financially imaginative options, or are firmly entrenching the traditional thinking of ‘go to school, get a job, save some pay, buy stuff, retire’?
Half of all students who enroll at university don’t finish their degree. The concept of ‘job for life’ is historic. Today’s student is very likely to work in a role not even created yet!
So what does all this mean for their bank balance?
It means that financial literacy from a young age is just as important as the skills of reading, writing, using technology and solving problems.
Given we live in a world where change envelops us – think credit crunch, rise of terrorism and climate shifts – I meet plenty of parents (and teachers!) who readily admit their money management skills aren’t able to cope with the external pressures they face.
Petrol goes up in price. Ouch! Dairy products are more expensive. Ouch! Mortgage rates rise. Ouch!
One of the scariest questions I can ask a parent is “Do you want your children to have the same level of financial confidence and ability as you?” Their eyes widen in horror as the realisation hits them: they are the fiscal role-model for their kids.
This is often a vicious cycle, because we may have not learnt sound wealth-creation strategies from our own parents. In many cases, ‘cash’ is a four-letter-word. Being ‘rich’ is somehow taboo.
Having skills in creating, spending, saving, donating and investing money are vital in the overall self-confidence of children. Rather than being dependant on their parents, or their employers, or the government, financially savvy young adults have greater choice and are more resilient to the uncertainties of a changing world.
Here’s five ways to develop money-mastery in your children:
- Never, ever, ever, ever, EVER laugh at any money-making idea your child comes up with. Ask them questions instead.
- Play What-If? A simple game of questions: ‘What if you weren’t able to go to university – what would you do?’ or ‘What if people paid you for your top skills – which talent would you choose to hone?’ or ‘What if you didn’t need more money – how would you spend your time?’… let them turn the questions back at you too!
- Hunt out and share stories of financially successful people. Bill Gates, Richard Branson, Martha Stewart, Warren Buffet, Walt Disney: what do they have in common? What attributes do wealthy people never have?
- Develop a system to teach the value of a dollar. I use the Four-Part Money Mastery system, which divides income (whether it’s pocket money, birthday cash from Grandma or wages) into Spending, Saving, Donating and Wealth.
- Give your children opportunities to take on financial responsibility. If you are planning a holiday away, can they manage researching the best travel and accommodation deals? Is your teenager capable of budgeting their entire weekly spending? (They’ll have to do it when they leave home, so now’s the time to teach them how!)
I bet your kids have plenty of off-the-wall, never-seen-the-light-of-day-because-they’re-so-wacky, risky-but-fun ideas for making a dollar or two. Encourage them to develop their financial imagination!
Stuart Fleming
Creator of the Money Mindset Mob
Enthusiastic believer in independent teens
Teens – here are tips for getting your head around money: http://MoneyMindsetMob.com
Parents – download your f-r-e-e audio clips and worksheets: http://StuartFleming.com
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