As our kids became teenagers, they drove us nuts asking us to fund this and that until we just wanted to scream! It’s not that they were asking for anything unreasonable, or even things we shouldn’t be paying for as parents. However, it was a constant begging and nagging that just took us to the edge. It’s what we used to call “nickled and dimed,” but times have changed!
As a solution, my wife and I agreed we should sit down with the oldest child as he entered high school and develop a reasonable budget that would include all of his normal expenses, including an allowance for play. We discussed and included clothes, gas, car insurance, hygiene items, phones, electronics, extracurricular school expenses, band trips, scout dues, school books, school uniforms, allowances, fast food …anything that was an on-going and regular expense we could predict. At a family meeting, we developed together a budget that included everything reasonable we could imagine and then adopted that budget for a year: September through August. Each year it became an easier process with more history, experience and education for our son and for us!
As a means of funding the budget, we divided the annual total of our son’s planned expenses by 12 and transferred that amount monthly to his checking account using payroll deduction from my employer. Like all of us with our family expenses, he was ahead sometimes and behind others. It was a challenge for our son to learn the ropes of saving for the rainy day, but within a year he had the hang of it. We were always there to encourage and teach. As he grew older, we made adjustments for his part-time job income in the budget. The system worked through college and until he was on his own with a professional job to fund his activities.
We followed the same system with our daughter as she entered high school. For her it proved a bit more challenging with a loan here and there from Mom and Dad, but we kept a spreadsheet record and she took it seriously.
As a side note, we did not try to predict extraordinary expenses like medical bills and their part in a family vacation. The variables were too great and unpredictable. We continued to pick up the tab on those types of expenses.
Our daughter is single and still trying to finish college, but she works hard to live frugally on her own with a waitress’ income. She remains supportive of herself, except in times of medical crisis that are understandable. When waitresses don’t work, they don’t get paid! She, too, takes pride in her ability to stay out of debt and make ends meet. It absolutely kills her to come to us for help. But what are families for, but to be of support to each other in real times of need. We continue to teach her the need to save for the rainy day. We are very proud of both children!
In summary, we were spared the nagging we had hated. As our kids went through high school and college, the best unplanned outcome was a controlled safety net environment for learning budgeting, personal finance and financial discipline.
Today, our son is 30 years old with a wife and two kids. He has a great job and his wife has her own small business. They have remained out of debt and financially stable. I am amazed at the good decision making he has exercised when making financial decisions for him and his family.
Teaching your kids financial responsibility at a young age is one of the best gifts you could give as a parent. Enjoy!
Kent Couch is the Principal Partner at Paraclete Ventures LLC, a Daily Money Management firm serving Seniors and Busy Professionals and Seniors in the Arlington, Mansfield and Tarrant County, Texas area.