Should You Discuss Money In Front of Your Kids?

The economic downturn beginning in 2007 caused financial hardship for many families who had to cope with job loss, foreclosures, and bankruptcies. 

While not every family may have had such a difficult time financially, there are still other strains on family finances such as rising gas and grocery prices.

As a parent, should you talk about money with your spouse in front of the children?

Of course, this is a deeply personal issue, and many will have differing views.  However, there is a valid reason to talk about money issues in front of your kids.

Benefit of Talking about Finances in Front of Your Kids


If your money is tight and your kids are aware of this fact, your kids will understand why they can’t have something they want.

This is especially important if you have previously been quite free with your money and have given your children most of what they want.  If you suddenly stop buying them things, they will wonder why.  However, if they have overheard your conversations about finances, they will have a better idea why their request for something is being declined or why you may have to choose a cheaper option.

discuss money with kids

Do you discuss family finances in front of the kids?

My husband and I have quite a bit of debt to pay off, so all of our extra money is being funneled to debt repayment.

My son has some idea about this because of conversations he has heard between me and my husband.  When I took him tennis shoe shopping a few months ago, he liked a pair that cost $50, but settled on a pair that cost $25 because he rationalized that the $25 pair were just as good as the $50 pair.

He had this thought process out loud with little input from me.

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I was very proud of him.  It was fun to see him evaluate that even though the $50 pair had a character he liked on the shoe and the $25 pair didn’t, the $25 pair fit better into our family finances.  Ultimately I think hearing our conversations and watching us be conservative with money will help him manage his own finances better as he grows older.

Potential Drawbacks to Discussing Finances in Front of Your Kids

Some may argue that you should not talk about finances with your kids because they are the kids and you are the adults; you are the one who should carry any burden as far as the finances are concerned.

These parents believe that childhood is not the time to be privy to adult financial discussions.

While I understand the concerns, there is a risk that not sharing any financial struggles and successes with your children will give them the idea that there will always be money available.  Instead, it may be better to let them hear you discuss finances and watch you manage money so they can learn how to do so themselves.  This can start as early as five or six years old as they learn to manage their allowance.

Some Rules to Follow When Discussing Finances

If you are going to talk to your children about money or have a discussion with your spouse when the children are around, there are a few strategies you will want to take to make this conversation as productive as possible:

- Avoid scaring your children.  To say something like, “We may lose the home if we can’t make our mortgage payment this month” is something no child should hear, even if it is true.  While it is okay to share that money is tight, it is not good to share something they have no control of that may scare them.

- Don’t tell your exact income.  Children, especially young tweens, have difficulty understanding how much it costs to run a household.  While they may know about your financial situation in general, it is probably best not to give exact expenses and income information until they are in their late teens and getting ready to go out on their own and manage their own money.

- Let them watch you be conservative with money.  Cutting back on expenses is easiest for children if you already follow a fairly frugal lifestyle.  Love them or hate them, the Duggars are raising 19 kids without any public assistance.  They repeatedly say that their mantra is “Buy used and save the difference.”  Their kids don’t expect brand new items because the family has made it very clear that one of the ways they keep the family finances in the black is by buying used.  They follow this mantra for clothing, cars, and trailers.

Finally

The decision whether to discuss family finances in front of your children is a personal one and you have to do what is best with your family.  We have decided to occasionally discuss our finances in general terms with our children present, and thus far, we are happy with that decision and what it is teaching our oldest child.

Do you discuss your finances in front of your children?  Why or why not?

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Published or updated October 25, 2012.

Comments

  1. Absolutely. Assuming two adults can have a sensible conversation about money without flaring emotions, there’s no sense in hiding it from kids. Being a positive role model is such an important part of parenting, particularly when it pertains to finances. You might be able to teach your kids by telling them how to interact with money, but they’ll learn more by seeing what their parents do. As long as the parents model good household-finance practices, they’ll be taking big steps to instill the same values in their children.

    • Carl Lassegue says:

      I think you hit it right on the head. If talking about money usually turns into a fight, then it might be a good idea to keep that away from children.

      • Teaching by doing is definitely a big way to truly teach. You can tell them all you want but kids will take their queues from what they see you doing.

        And I think we’re assuming a civilized discussion. I don’t think arguing about money, or really much else, is good in from of the kids.

  2. Also, to answer the question you posed at the bottom, I do not yet have children, but if I had children I wouldn’t be too concerned about exposing them to family financial discussions… and involving them when they’re old enough to be somewhat interested.

  3. If discussing finances is an argument about money, don’t do it in front of your children! If the discussion is a plan to resolve something or some other constructive conversation, then you should. Children learn a great deal from parents from how they handle problems.

    • Anytime you can open up a discussion with your kids and hear out what they are thinking then that’s a good thing. It can be surprising to find out what’s really going on in their minds.

  4. I am a father of an extended family of seven kids – and have believed in discussing finances with all my kids from as early an age as they can handle. I am in the finance business, and I am pretty open with them, and they seem to appreciate and listen – but I gotta tell you in a few cases it looks like it all went in one ear and out the other!

    I would say only my oldest son (now 23) takes care of his finances in a way that makes me proud

    • Great to hear that your actions had a positive influence on your son!

      Yeah, no matter what we try sometimes they aren’t going to take our advice to heart and they have to make their own mistakes. But better you open up the discussion, you never know what will stick.

  5. We discuss money in front of our son, and with our son. While we don’t go into details, we do let him hear us talk about where our financial resources should go, and, when it’s appropriate, include him in the discussions.

    • We don’t go into specifics either. I don’t think they need to know exactly what we make or spend though it’s fine to help them understand what things cost and why we have to make money.

  6. When I have kids someday, I plan to discuss finances with them so they can understand that money has to be earned and managed wisely. I do think it’s important not to let them feel stress over it though (which you mention by saying not to scare them). I don’t think kids should know what financial hardship means on an emotional level unless there’s no way to avoid it. However, I do think it is a risk worth taking because teaching them about money and how to handle it will help them be more financially responsible adults.

  7. I do not give specific numbers to my kids, but my husband and I do let them know that we have a budget that we live within. Currently, my daughter wants a new bike. She has waited 5 weeks now for a new one. She knows that this is the weekend that, through planning and saving, her bike is to be funded. She has taken this time to figure out what “bells and whistles” she wants in her new bike.

    For me, it really is just a matter of answering questions or responding to statements honestly and calmly. One time, my daughter randomly announced in the car that she knows we are poor because we never eat out. I had to chuckle, and then explain that eating in is a tool. Not only does it let me control what goes into our meals and make them more nutritious, but that the money we save was allowing us to enjoy other things, like vacations, bikes, and all sorts of fun stuff. Hopefully, we are teaching them the importance of prior planning in life.

  8. Parents are here to teach their children and to offer a good example.
    I absolutely think that they shoud discuss finances in front of their children. I also think that all children should learn financial literacy from earliest childhood.

    Don’t wait until your sons and daughters are in school. I received my first bank from my Godmother by the age of three. She explained to me that I should save my pennies and nickles and use this money to buy my popsicles. I don’t think I “got it” on the first try, but she gave me something tangible to think about.

    There are some very important organizations in the States with volunteers who are trying to teach financial literacy to children. One of these is Jump$tart. They offer a great deal of helpful information.

    Lori Blatzheim

  9. Just to play devil’s advocate since everyone on here loves to talk about money (hence why they are reading this fantastic blog)…

    Can’t the real negative be that you are causing stress in a child’s life which could cause unhealthy tendencies (as opposed to just good knowledge) towards money? For example, if they learn the scarcity of money but not have a good base in something else like morality they could end up on the pole!

    http://www.youtube.com/watch?v=tojBadSr2zI

  10. I agree with the article writer. It’s okay to let children know that money is tight and doesn’t grow on trees, but don’t tell them things that will scare them like “We’re going to loose our home in a few months”.

    I think it’s good to share parts of your budget with them to help them see how much groceries, for example, cost and how it’s important to stay within the amount you have allocated for groceries each month.

  11. Great article! I always thought people were oversensitive about talking about money in their family. This article shows all the positives of talking about finances with kids and also shows the negatives in a sensitive way. The three rules for talking to kids are essential.

  12. Chase Miller says:

    From a teens perspective – Talking about finances as a family is one of the best ways for kids like me to learn. It will teach us real world lessons and encourage us to be responsible with our money.

  13. Most experts agree that the younger those kids get that money training, all the better. If you are already planning your family’s financial future with an expert such as a financial planning professional, such an expert might advise you on ways to teach your kids about money as well.

  14. Very timely article. My daughter just asked me how much I made yesterday and I told her that we don’t plan to share this information with her until she gets a little older (she’s 9). We do very openly discuss money and choices we make with money and I know that has had an impact on them because, just as in the author’s case, they are always explaining their reasoning for wanting to buy one item instead of another. I think the most important thing we can do as parents is to make the subject of money comfortable for our kids so that they’ll recognize that it’s a tool or means rather than an end in itself.

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