Neither DH or I were raised with any understanding of money. We've learned a lot over the years (some of it the hard way). We really like Dave Ramsey stuff and the book "The Millionaire Next Door" (though honestly, we take what works for us and leave the rest).
Our kids are teens now I'd like to help them enter adulthood a little better equipped to make financial decisions. So far....
- Our kids have chores and have allowance. Their allowance is their "fun money" and they have to plan ahead when something big, like the Ren Fest is coming up. Allowance didn't work when they were little because they just spent it all on stupid stuff, but at 13 and 15, they can budge for simple, recreational activities. (They like to shop at the used book store because their allowance goes further there)
- Clothing lump sum. When seasons change, we give our kids a lump sum for clothes. I sit down with them and talk through what they need. Do they need new underwear? Shoes? Coat? etc. They go through what they have and sort what still works and doesn't work. Then they plan where to go. They have learned to hit places like TJ Max before heading to the mall, but that jeans you love are worth paying a little extra for.
- We have some financial conversations around them -- such as tax planning, 401K, the cost of college, how different career choices end up with different incomes. We would like them to pursue something they are passionate about, but we also want them to have a little realism that about how income is tied to those choices.
- We are trying to hit a middle road of teaching them that it is silly to spend more than you have to for something, but that some things are worth the extra cost.
On one hand, I think we are doing a better job that a lot of parents I see around me, but since I didn't grow up with any sort of education in this area, I'm curious what other parents do that seems to work.
I'd really like it if when they leave home, they are capable of making financial decisions they will be happy with. I don't care if they end up with the same list of "things that are worth paying a little extra for" and I don't want them to believe that they need to end up with a high income to be happy.
So, what did your parents do that seemed to work? What are you doing with your own kids?