How can I stop the incidentals [for] my teen daughters and their wants at the drugstore for makeup and shampoo, etc? [Should I] Give my girls an allowance/budget for misc. items and clothing?
I received this question on teens and money from a reader a few months ago (sorry dear reader, I’m a little slow!).
I’ll share how we handle this in the second half of this post. But it’s funny how this simple question made me think about financial education. So, I felt the need to go on a little tangent before I talk about that.
A little disclaimer here: You may not agree, and that’s okay. Since every family, and every teenager, is different, what works for me won’t necessarily work for you.
The Best Financial Education
I think there is a dire need for financial education in schools because most kids don’t learn important money lessons at home. I know it’s not a topic many families are willing to talk about.
But this is unfortunate. It’s much easier to learn from real life situations than a textbook. Breaking the money-talk taboo and having real-life money conversations as a family is one of the best ways to provide your kids with financial education.
You don’t have to manage your finances perfectly to teach your kids the lessons they need. And you may still be trying to figure things out for yourself. That’s okay. Even if you’ve made mistakes, admit them. Discussing why they were made and how to fix them is an interesting and effective way to teach your kids about money.
As for my kids, they have learned about money, not through a formal system of financial education, but by us keeping it real. We share our financial situation, why we make the spending and saving choices we do, how we budget, and what things cost. We talk about the trade offs – for example, if we spend money on new cars, we couldn’t take that family vacation. On our vacations, we set a budget and have them make decisions on how to spend it. Last summer, I had them pay the household bills for a month to allow them to see what comes in and what goes out.
If I had to take a stab at it, I bet money/finance comes up in conversation with them at least 3 times each week (probably more). We talk about it often. Money is not a taboo topic in our house, in fact, it’s quite the opposite.
I think every parent approaches this differently and what works for one family may not work for another. As I did some research, I found most advice for parents pointed to helping teens develop a budget and track their spending. And I think this is great. Especially if your teenager is on board with learning and implementing it. But I’m pretty sure mine would not want the “help” if I were to offer.
Though we do require our kids to save a certain amount and encourage giving, I’m certain I’d be met with resistance if I asked them to set up a budget. Sure, they have savings and checking accounts, they use a debit card and track their balances. And they do budget money in a way that makes sense to them (though it sometimes doesn’t make sense to me!).*
Teens and Money: How We Operate
With teenagers, or any age child, for that matter, it can be hard to place limits on purchases, especially when they see their friends (or their friends’ parents) buying things they want too.
(That brings up the issue of needs vs. wants. It’s hard for us as adults to distinguish between the two, but it’s even harder for kids. I’ve had the needs/wants discussion with my kids so many times, they could tell it verbatim. And, though they completely understand my take on it, they don’t always agree with it. I tell myself, one day in the future, they will get it. Right!???)
How we handle spending
We provide food, shelter, clothing, personal care (within reason) and other needs for our kids. That said, there are things within those categories that I don’t see as needs. Take the food category – in my book, soda and candy are not needs, so I don’t purchase them. If my kids want to buy soda, they can do so with their own money.
The same goes for clothing. For example, I have a set budget for shoes when we go shoe shopping. If they want a pair that goes over budget, they are responsible for the amount above and beyond my budget.
As far as incidentals, such as shampoo and makeup go, it’s the same thing. I don’t spend any more on their personal care items than I do on my own. If my daughter wants the salon shampoo, she is responsible for the difference in cost.
As I write this, I hope I don’t come across as a scrooge. I’m not stingy and cheap, but I am frugal and intentional. Alan and I explain why we make these spending decisions – we value the time we spend doing things together more than the sugary drinks, salon shampoo, name brand jeans, and latest shoes. We would rather be able to take a vacation than have a closet full of designer clothes. And they know the difference, even when they don’t want to admit it.
Our kids are polar opposites when it comes to their money (one is a saver, one is a spender). No matter how much we try to convince our son to save, he consistently spends almost everything that comes his way (thankfully he doesn’t like the idea of owing anyone and we discuss the consequences of debt often). We have instituted a savings rule to get him to save a decent percentage of his money. While I’m not a big fan of forcing the issue, I can’t just sit by and watch it all disappear on ice cream from the gas station.
Our daughter, on the other hand, is as frugal as they come. She always has a stash of cash on hand and is reluctant to part with it. In addition. she has a significant amount in the bank. She budgets her spending and discerns what spending provides the most value to her. My only hope is she doesn’t take her frugality to an extreme.
We’re willing to let our kids learn some lessons the hard way. While we’ll always make sure their basic needs are met and they are safe, we are big believers in natural consequences. If you spend all your money on a video game, you don’t have money to go out to eat with friends. If you run out of gas, mom gets to drive you to school. (So far, I haven’t had to drive him to school.) Those are the choices and trade-offs you make.
How do you handle spending on your kids? How did your parents handle spending on you when you were a teenager?
*If they run out, it’s on them. No handouts from mom and dad!