Momma's don't let your babies grow up to be Greebo's (Teach them about money early)

[Greebo]

A recent thread about a mother destroying a credit card offer sent to her 18 yr old child got me thinking, and I wanted to share a cautionary tale to all the parents out there who are sheltering their children from choices that sooner, or later, they will have to face.

The cautionary tale is mine.

My parents never made a lot of money, but they were both post-Depression children, born in the 1940's. They lived on very little growing up. My paternal grandparents lost a house in the 30's. My maternal grandmother and her 6 children lived in another woman's house - a house where the homeowner was more of the mother than my grandmother.

So when my parents married and started making a life together, they were, naturally, very frugal. Dad left the finance management to Mom - he just got money from her when he needed it, which wasn't often. Mom managed the banking and investing, and did a great job. I don't think they ever carried any non-mortgage debt. They used CC's but never carried a balance. EVER. They were very cautious with every penny.

But they failed in one very important area - training their son to manage money.

I cannot remember my parents really EVER teaching me anything about money. I remember I had an allowance as a teen - $1.00 per day (this was in the 80's), and I was allowed to borrow against my allowance. I was perpetually - PERPETUALLY 1-2 months ahead on my allowance.

I remember being made treasurer of the computer club to which I belonged, and I used that money inappropriately, and they bailed me out.

I remember taking money from mom's purse - many times - and when I was younger I got called out on it once and told not to do it, but later I did it again and never got called out on it.

I remember having candy sales where I'd eat the candy and they'd pay for what I owed.

I remember going to college and them sending me money anytime I asked for it - bailing me out again and again.

I remember leaving college before I finished, with them having paid cash for the whole thing, but having no consequences for me just up and leaving.

Oh and I left college with 3 maxed out credit cards.

It wasn't until I got into Amway, in college, of all things, that I started hearing lessons from successful people about personal responsibility that I realized I needed to stop leeching off of my parents. But I still never learned about *money*. So I got good at working hard, but never was able to work so hard that I could out earn my stupidity.

It wasn't until I was in my 30s that I finally started actually getting control of my money, with ceashel's help. I remember being *ashamed* of my money situation, and being afraid to ask her to marry me because I didn't want to have to tell her how bad my money situation really was. The day I came clean was the day I actually proposed. (We'd been planning to marry - I just hadn't actually, you know, ASKED).

Parents - please, please, please for your children's sake. DO NOT make your children into another me. Do NOT shield them from having to learn about money, do not hide money decisions from them, and DO NOT, DO NOT, DO NOT bail them out if they get into trouble unless they COMMIT to you to change what they're doing.

This is one of those areas where I KNOW you don't want your children to struggle, but you HAVE TO TEACH THEM and then LET THEM FALL DOWN from time to time, or they're never going to be able to function on their own.

[Telephus44]

This is one thing my parents did. (Ok, they did lots of other things too - I don't mean to imply that they weren't great parents, because they are).

My father opened accounts for us as kids. I had my first checking account with ATM card at age 12. They didn't sit down with a written budget to explain it to me, but I was taught that some bills are fixed and some are variable (like electricity or phone), that you can pay extra on things, how to minimize and/or avoid interest. As I got older (teen) he started explaining investing (how stocks and bonds work) and more macro-economic theory (how inflation and regulation works).

Other than paying for a chunk of my college education (not all, I had loans that were also explained to me before I took them out) and giving me a lump sum of $2000 at graduation and co-signing for a car loan at graduation, I've never had to ask for or borrow from them. I think that they did a great job with financial education.

[Mom2-3]

Yup- we do this with our kids. DH family NEVER talked about money. To DH it always seemed they had no financial troubles with endless money. Umm- yeah, not the real story. He found out as an adult!

My parents lived on credit cards. I always heard that they "needed" these things. Had to have them. I now know that they really wanted those things and convinced themselves they needed to have it. Thus-a TON of credit card debt.

We wanted to give the kids as much info as we could on the subject, so that they can live better than our parents and hopefully us!

[frugal is fun]

I'm not really sure what happened to me. You'd swear that my brother and I not only grew up in different houses but had completely different parents.

I don't remember my parents ever talking about money but I know I had a savings account at a very young age and I always had a Christmas club as a kid.

When I was in middleschool/early highscool my brother and I both got $15 a week allowance. this was a HUGE amount of money. However we were responsible for buying our own stuff. My parents provided food, shelter and clothes.

When I was 16 and got my first job I had to pay my mother 10% of my check for room and board. I remember giving her $3 since my check was for $30. I continued to give her 10% of my pay check until I moved out at the age of 25. In my older years I just had the money direct deposited to a joint account. (when I got engaged my mother gave me all the money back and I was able to pay for my wedding cash)

I didn't go to college after highschool, I got a full time job and I have always been responsible with my money.

my brother on the other hand went to college and literally had everything given to him, cars, clothes, tvs, furniture, toilet paper, food, EVERYTHING. My brother is now 42 years old and literally has nothing. He has horrible credit and not a pot to piss in.

He defaulted on more credit cards than I can count and mommy and daddy paid for those too.

When I was 19 I got a job at the company I currently work for. They paid 75% of college tuition and books. It took me 12 years to get my degree but I am the only one in my class that graduated with zero debt.

So Greebo makes a very good point about bailing your kids out and not letting them fail or even learn early on in life about money.

I'm frugal not because I'm in debt, I'm frugal because I'm smart!

[Momto5RN]

my kids get a monthly allowance or what we call budgeted spending money -

for the older kids its enough to cover a high school lunch each school day - but they can choose to use it for a video game to go out to movies they need to use it for gas when they drive etc - of course if they do that they need to cut back on what they eat at school or brown bag something in .

the younger two still get a smaller amt but once a month so they too know they have to decide what they want to spend it on and once its gone its gone unless i have extra chores to offer for money .

has done well teaching them to budget and the ATM doesnt just spit out money from the moon .

my 19 yo dd who i use to worry about the same way the poster about the CC in the mail does-... i was very concerned she would graduate HS be 18 and end up with CC for every store at the mall run up to the max - but she actually did very well after a few months of running out of money too early and started to budget each months $$ with a written list of what she planned to do with it - got a PT job as a hostess has worked herself up to waitress and just paid for her college semester in cash and plans to work enough to pay cash for next semester too . has said no to people trying to give her CC at the mall etc ( because even if you avoid them in the mall - alot os stores like sears etc have mastercards with their names on it you can sign up for)

3 years back i never - ever thought i would see this day - i
told dh i would never co sign any student loans for her
thinking she would just not pay them and expect me too and she just did a total change around when she decided what she wanted to do in life.

so there is hope for all those with kids who tend to think $$ grows on trees !!

[craftypam]

Its very true what Greebo said; but, I raised 3 sons the same way and have always been frugal. I have never paid interest on a credit card and have always had an emergency fund to cover many months of expenses. My sons had paper routes and paid for things on their own. My oldest ds has no clue about money at all. The 2nd one has finally learned, same as Greebo, by his mistakes and the 3rd one is pretty good, but still needs to get better about cc. You can only try to teach them and when they grow up they are going to do what they are going to do.
Greebo; what made you change the attitude that you want what you want when you want it? That seems to be the issue with most of the people who are in deep debt.

There is a great book that came out too late to teach my sons about money. Its called the sink or swim money program. It bascially teaches that you give your kids the money that you would spend on school supplies, clothes, school functions etc.; and then the have to manage the money and there is no getting money ahead of time.

[Palooka]

My parents were very frugal and taught us about money. I teach my kids about money and debt. My daughter has a savings and checking and has been doing great with the budget I have suggested to her. My name is on the accounts but I can take it off now that she is eighteen and she also knows all about how credit cards work. Thank goodness her dad is very responsible with money and pounds it in her head too.

[Labontet]

Very, very good post Greebo. Thank you for sharing that.
I tried very hard to teach my dd's about money, but that along with sewing, cooking, etc. just went in one ear and out the other.

Both of my girls have never, ever been good with money.
I feel like I enabled them in their lack of respect of money, by constantly bailing them out too. Even to this day I still am an enabler.

I really wish that I had been a better teacher, or maybe that they had been better students of financial matters.

[Minner77]

Wow, Greebo. Fascinating you should write this.

I have been a member of FV for a long time. I lurk probably more than I should-- partly out of time and health, but partly because while I share many of your philosophies, I don't believe I have your, shall we say gift, for speaking the truth without offending.

I was raised with great financial sense by wise parents, as was my husband. Neither of us had extra pennies growing up, so we got scholarships, got ourselves through college and master's programs, and do just fine, thank you. But we were then -- when money was extremely tight -- and are now very careful, very responsible, which is how we live the life we and our children enjoy (we're not deprived).

One thing, BTW, I often am astounded at in my life is that people ask me flat out why I use freecycle, for example, when I could "afford" to buy new. Well, not only am I a committed "friend of the earth," but I hate to waste! (P.S., I have been on the giving end 99.999% of the time..... ) Also.... why do I shop sales? drive an older car? not live in a fancier house? not buy my kids every little thing they want, since we "have the money" etc. etc.

Priceless saying from my father, God rest his soul: Just because you "have the money" doesn't mean "you can afford it."

I am making this very short, but the bottom line is that I sometimes want to just scream at what people rationalize, even here. But even in my anonymity I am afraid of offending..... so hooray to you, and shame on me, and best of luck to all here. I have learned much and receive great reinforcement, inspiration, and continual motivation. FV rocks!

Thanks to you all.
~M

[Greebo]

I don't believe I have your, shall we say gift, for speaking the truth without offending.

Say what now???

[wjcalderon]

I was standing in line the other day at a book fair at my granddaughter's school.
The woman in front of me was letting the child (maybe 10 years old) actually swipe her credit card.
She said, "You need to learn how to do this - get used to it."
I said, "No, don't tell her that!"
The other woman just laughed.
So sad.....

[Brat]

I tryed to teach my kids..One kinda learned but still has to struggle..The other one still does not get it at almost 40..but I have alway bailed her out...This time I let her struggle for 4 years before I stepped in but it didn't teach her a thing..she is back to the same ol same ol...

[TheRootedNomad]

We work very hard to teach our boys about money. Sometimes I wonder, if we give them too much information , and then I think there is no such thing as too much information. Knowledge is power. The biggest reason by far that we work so hard in this area is that when it came down to actual financial knowledge neither of us was taught much about money.

I grew up in a very frugal household and I was taught to shop sales and thrift stores because money was tight. My grandparents (extended family household)gardened and cooked from scratch and were very much do-it-yourselfers, though they didn't have to be. This was always rolemodeled but never explained from a financial perspective and I later learned how frequently they bailed dad out financially (gambling). Mom did take part of my money to teach me to save some for a rainy day but other than that there was no "discussion" about money ever. They didn't bail me out, EVER, and I did learn that money doesn't grow on trees but budgets, investments, intrests, cc's, banking accounts, retirement, ect. didn't ever come up.

DH on the other hand was raised on the opposite side of the spectrum. His mom worked 3 jobs at times and the kids got whatever they wanted. If there wasn't enough money you pull out a cc, when that ones maxed get another, and so on. All the debt principals - on how to get into debt - were modeled AND taught.

Luckily, being out on our own, together, and far from where we could be easily bailed out, at a young age we struggled through on our own learning as we went. We are still learning and we definately took some REALLY hard falls that could have been avoided if we knew better. You always want better for your kids. Because of our falls due to lack of knowledge we are arming our children with as much of it as we can give them.

[Darlene]

I enjoyed your cautionary tale Greebo but now I can't get the song Mama Don't Let Your Babies Grow Up To Be Cowboys out of my head.

[gmarie]

[QUOTE=Sometimes I wonder, if we give them too much information , and then I think there is no such thing as too much information. Knowledge is power. The biggest reason by far that we work so hard in this area is that when it came down to actual financial knowledge neither of us was taught much about money.
[/QUOTE]

I think that every parent should teach their kids about money, but I don't think that parents should express their money fears to their children.

I was raised by a single mother and we always managed to get by, and never went without food or electricity or clothing, but she never withheld any information from us, and I remember being very scared about the lack of money - and I don't think that's fair to do to a child.