Bank on this

Written by: Lianne Castelino

Published: Mar 28, 2011

The topic is everywhere we turn. At both a macro and micro level. Debt reduction, budgeting, Wall Street, financial crisis, world economy, saving and spending. Our society, and rightly so, is obsessed with how money is spent. Too bad we all weren’t this conscientious during the ‘good times’. Now, for the most part, money seems to be harder to come by. People living beyond their means is fairly commonplace. Credit has created many monsters, tons of hardship and less and less accountability.

I remember the days and they weren’t that long ago, when you could stroll through a university campus and find tables set up with banks/financial institutions flogging credit cards for students. You literally had to have a pulse and you got approved. What a stunning mistake. (I haven’t spent much time inside a college or university campus of late, so perhaps it still happens.)

The bottom line? Never has there been a greater need for kids to be educated properly about money. And not all parents are equipped to do this. Save and spend seem to be fairly simple concepts until crisis strikes and the item you need to buy exceeds your ability to pay, or you’ve ‘absolutely’ got to have something even though you don’t have the money for it.

It is not easy teaching children about money in a generation of self-entitlement and instant gratification. In our household, we constantly preach patience — prudent but utterly exhausting.

The conversation usually goes something this: “I want to buy a XXXX, mom”. The response? “Okay, why do you need it?” Silence follows. “Everyone else has one.” Pause. “That’s really not a good reason.” Another try. “But why can’t I have it.” Deep breath. “I’d like to win the lottery or take a long vacation, but I can’t.” Silence. Huffing, muttering, grumbling. It may not be the best strategy according to parenting experts, but it works in our house. They go off and think about the conversation and end up understanding they don’t have to have something right away.

Since just before Christmas one of my kids has been after us for an ipod touch. If this kid does not end up in public relations, I will be shocked! His powers of persuasion and spin are something to behold for a tween and his tenacity is becoming legendary. We’ve remained steadfast. “You don’t need an ipod touch. You don’t have the money to buy one. Save your money and then we can look at it.”

I can cave in and be spineless with the best of them when it comes to certain requests my kids make, believe me. But over the years I’ve learned that doesn’t pay off in the long run — for them or us.

He keeps coming back for more. We repeat the same refrain. The bottom line is —- we have all survived. Saying no isn’t always easy, but when it comes to money it usually makes sense and cents.

Best-selling author, financial journalist ( and television host, Alison Griffiths, preaches just that. Basic common sense. If you can’t pay for it, you cannot buy it, which means you can’t have it.

She offers parents some basic tips about how to teach kids about money management.

( Watch our interview with Alison Griffiths )

In this world of fleeting wealth, where the middle class is getting stretched further by the minute, where the chasm between rich and poor is expanding, and where many people are re-evaluating their needs and wants based on what they can afford, it makes sense to start kids off on a solid financial footing — which usually means equal parts of common sense and accountability.

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