When I was little, maybe 8, we had some of my parents’ friends over and were all hanging out. I forget what we were talking about, but suddenly I looked over at my dad and said, “If something happens to you, will I get money in your will?”
I was a fearful kid. I’d been lying awake at night wondering what would happen to me if I didn’t have parents anymore. I was probably also thinking about toys, but I digress… 😉 This seemed like as good a time as any to talk about it.
The conversation STOPPED. You could have heard a pin drop in that room.
At some point someone probably laughed and changed the subject. My dad said we would talk about it “later”, which meant never. All I remember is the distinct message: Don’t talk about money. EVER.
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The taboo against talking about money goes back to British nobility, who believed it was ‘gauche’ to discuss finances. (As a side effect, this protected them from public moral outrage of their lavish and wasteful lifestyles). Aspiring to class mobility and wishing to be proper, Americans adopted this mentality.
In fact, according to a 2014 Wells Fargo survey, Americans rate finances the most difficult topic to talk about with someone else. They rated it more difficult to talk about than death, politics, and religion.
This while 39% of us report that money is our biggest stressor, and a third of us (33%) report losing sleep over money.
And yet. In our fellow British-spawned neighbor to the north — Canada — 46% of households have created a budget. Which brings us to the United States, where a measly 32% of households use a budget.
Like European nobility, Americans in the middle class like to pretend that we are SO RIDICULOUSLY RICH that we don’t NEED to teach our kids about money. Because when you’re ridiculously rich, money management doesn’t matter. You can eat at restaurants that have no price list. Who cares? No matter what the price is, you can afford it.
Talking about money with family seems like one more hassle sometimes, and the truth is that we can get away with ignoring it for a while. But is your family in a position that you walk into any furniture store or car dealership and buy whatever you want without looking at the price tag?
Do you expect to leave SO MUCH MONEY to your kids that they will never have to make any financial decisions?
Will your Trust Fund kids never have to work (and thus never negotiate a salary)?
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Money should be the first thing kids start learning about, right along with brushing their teeth.
Money is the water we’re swimming in. It determines whether we eat. It’s the means by which we get a roof over our heads to shield us from the rain.
We can’t just not talk about money and hope for the best.
People say, “I don’t want my kids to have to worry about money like i did.” What that means in practice is, “I don’t want my kids to know about money.”
I’ve heard there are families where kids graduate from high school and don’t know how to open a bank account, negotiate a salary, or make a budget.
Wait — that’s pretty much everyone.
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I grew up knowing nothing about money. By age 18, I had finished high school, concluding 13 YEARS of formal education. That’s more than 14,000 hours. In that time, the only time money was discussed was when I learned how to count coins in second grade. (Remember those little paper nickels?)
I learned more about money from playing Monopoly with my cousins than I did in school.
At 18, I could conjugate any sentence: gerunds, adverbial phrases. I could tell you the percentage of presidential vetos that had been repealed by Congress (less than 10%), the percentage of Congress needed to amend the US Constitution (2/3). I could calculate and chart integrals and dissect a fetal pig. But I couldn’t even tell you how much a month of groceries cost.*
At 18, I could and did vote in state and national elections. I considered myself a responsible citizen and thought I knew my stances on all issues. Yet I didn’t have the faintest clue how much income tax was or even a ballpark figure of how much the average person pays for housing.
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I graduated from college at age 22 with no more knowledge than I’d had at 18 — the Monopoly level. I didn’t know what a 401k was (and so didn’t contribute or take advantage of my company’s 4% match).
I had a college degree in English that I had been told would keep me employed for life, but turned out to be useless. I chose that degree because I’d been told by everyone I knew: “You should do whatever you want for work! Money doesn’t matter!”
I spent the rest of my 20s recovering from this belief through the school of hard knocks. In my cockroach-infested NYC apartment, I started to think that maybe money mattered more than I’d thought.
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What gives? Money is the water we’re swimming in. Why would we neglect something pivotal to survival just because it’s uncomfortable?
Reuters contributor Chris Taylor advises:
“If you tend to clam up about cash, pause for a moment and think about the longer-term effects. […Y]ou are likely to pass your traits down to your kids, who might turn pass them to their kids. Your bad habits could be amplified 50 years down the road.”
It’s time to stop pretending money doesn’t exist. Talk about money with your kids, with your nieces and nephews. You don’t have to get out your bank statement, but talk about the choices you make every day.
“You can choose to buy that small Star Wars lego set today, or save up and get the bigger version next month. There’s no wrong choice, just depends what you want.”
(Can we talk about how overpriced legos seem? My wallet is still crying from the last set…)
Talk about how you make money decisions — even and especially if you’ve made some bad ones and learned from your mistake.
Let your kids participate in your financial life. Let them make judgment calls and even mistakes.
“Hey, we have $15 budgeted for lunches this week. I’m going to give this to you and take you to the grocery, and you can pick out food that is going to keep you full. If you go over the budget, you’ll have to put something back.”
“Hey guys, we have X money for Christmas this year. We can either do lots of presents OR we can take a big road trip to the Grand Canyon. What do you think?”
Today is the day. Get out there and open the discussion. Your kids will thank you. And they’ll take that advice to the bank. Every. Single. Month.
*The book that finally gave me a sense of the US cost of living was Nickeled and Dimed: On (Not) Getting By in America, by Barbara Ehrenreich. After being intrigued by the title in my college bookstore, I stood there in the aisle for half an hour and devoured it.