Everyone has opinions on how kids should be raised. And there really are no perfect answers. However, I never thought there’d be a day when my own parents would tell me to stop talking to my kid about money.
But that’s exactly what happened.
If you’re not familiar with my daughter, she’s a stellar writer on the Route to Retire blog. Her post Like Father, Like Daughter… got some pretty good attention – including making it onto Rockstar Finance.
She’s seven and an extremely bright kid (I think most parents say that about their kids). She’s kind to everyone and has a great sense of humor. She’s artistic and loves gymnastics.
But one thing that makes her a little unique is she’s gained an interest in money… and I like that.
She’s always been a great saver for sure. As soon as she was old enough to understand what money was, I made sure to instill the idea of saving half of whatever she gets. If she gets money for a birthday, chores, or whatever, half goes into the bank.
I take that money and put it in Ally Bank. I’ve also instituted the “Daddy Match” to encourage her to save. Basically, for every dollar she gives me to put into savings, I throw in another dollar.
Because of that, sometimes she’ll give me a little extra (above and beyond our 50% rule) that she wants me to put into her account. Every time she hands me money to deposit, I show her where her account stands. She enjoys seeing her money grow… and that’s a good thing!
Soon, we’ll look at moving onto an investment account at Vanguard, but we’re not quite there yet. When we do get there though, that’ll be another perfect lead-in to talk about money some more and introduce her to the basics of the stock market.
Talking about money
I’m guessing that a lot of my daughter’s interest in money comes from me.
I think it’s important to be able to talk about subjects that are sometimes a little more taboo. That’s especially the case with money and personal finance as it has the potential to make or break a lot of your future.
However, I will add that I was always fascinated with money when I was a kid – and that wasn’t through any push from anyone. So it’s possible that a lot of her intrigue is her own.
Because we talk pretty freely in our house about money and the different aspects of it (earning, saving, and investing), my daughter doesn’t treat it as taboo either.
She’ll ask questions if we’re talking about bills or income, but she’ll also periodically start conversations with us on the subject. She doesn’t understand all the nuances, but I’d say she probably has a better grasp on it than a lot of kids.
Talking about money as a problem
My daughter hangs onto her money in her wallet and has a hard time parting with it.
Recently, she bought a few things at the store and was mad at herself for spending her money. I’m talking about her “spending” money and not the 50% she had already saved.
This became a great opportunity to explain to her that money’s important, but it’s not everything. I let her know that she should keep saving half of her money, but the rest is for life today.
I made it clear that she needs to remember to enjoy things today because you never know what could happen tomorrow. Then I morbidly told her that you never know – a bus could hit you when you’re at the bottom of the driveway getting the mail from the mailbox… such a wonderful dad, aren’t I?!
Regardless of my horrible way of putting it, she gets it and this made sense to her.
The point was to make sure that she understands that money is a tool, but you need to make sure it doesn’t overtake your life. I actually struggled with that for years – and still do a little bit. Paula Pant gave me the wake-up call I needed on that one though.
Learning about assets
I told her it had some online games to learn more about money, but that’s all I knew. She took it from there, played some of the games herself, and seemed to enjoy it.
The next morning, my parents were going to watch her since she was off school. While we were in the car on the way there, she started up a discussion and was telling me what assets are and why they’re important. She used an example from the site of buying a gumball machine that then earns money from other kids.
I was impressed – it took me until a lot later in life to get this and she’s already starting to comprehend such an important concept. We talked a little more about that and then moved on to some other non-money-related topics.
I dropped her off at my parents’ house and headed to work.
The jaw dropper
So here’s where it gets a little fun.
I swung by my parents’ house at lunchtime – they live about a mile from my office so I have lunch there almost daily.
As I was getting ready to head back to the office after lunch, my darling daughter said something about assets to all of us.
My parents were in shock as if she had blasted off a bunch of swear words. They asked her a bunch of questions about it then turned to me and said…
“You need to stop talking to her about money!” and then my favorite, “Let her be a kid!”
I was in awe… my jaw dropped. Wait, what??? Did they just say what I thought they said?!
Let her be a kid?
Believe it or not, I think the “let her be a kid” part raised my eyebrow more than the “stop talking about money” comment.
My long-time readers here know that my daughter and I have a fantastic relationship. We play a lot and do “kid” stuff all the time.
Maybe it’s family fun things like going on bike rides, feeding the fish in a nearby creek, and going to the playground. Or maybe it’s playing Mario Kart on the Wii – yeah, I still rock the Nintendo Wii and love it!
Sometimes we have family game night or movie night. Most of our school nights end with watching a little bit of kids TV shows together before going up and reading a book before bedtime.
We go camping, roast marshmallows, chase lightning bugs, and go to the drive-in… I’m out of breath, but I could go on and on.
And even with all that time together, the biggest reason I’m working toward FI is so I can quit my job to have even MORE time with her to do even MORE kid things.
On top of that, she’s finally at an age where she’s starting to hang out more with other friends. As I’m typing this, she’s currently at her first non-family sleepover at a friend’s house.
My point is she’s not sitting in “Dad’s Personal Finance Class” every day. That fraction of time when we’re talking about anything in the personal finance realm is really just a drop in the bucket compared to all the kid-fun we have going on.
Feed their interests
That said, money is an important tool in everyone’s life. And I believe that learning about money is especially important for kids.
I wished I had learned more about the nuances of how to make it work for me when I was young. It probably would have kept me from going almost $30k into credit card debt for no real reason. I likely also would have been buying up more rental properties when I was younger like Scott Trench, Guy on FIRE, or Coach Carson.
So every month or so, I’ll ask, “Are you ready for a money lesson?”
If the answer is yes, I teach her one thing to let her ponder… usually a 5 or 10-minute conversation.
My goal is to open up her mind to understanding different options. I want her to know that she doesn’t have to follow the “normal” path of life like getting a regular W2 job if she doesn’t want to.
She’s intrigued and enjoys it.
My parents know she enjoys money and they also know how much time we spend together having fun and playing.
So why would they say what they did? I don’t have an answer.
If my daughter had said, “I like pretending I’m a doctor”, would they have freaked out about it? Probably not. They likely would have bought her a stethoscope and a reflex hammer and told her to keep at it.
If a child is interested in something – anything – and wants to learn more about it, there’s no reason not to nourish them so they can learn and grow from it. And that should go double if a seven-year-old kid wants to understand money or personal finance better.
I’ll let you be the judge… should I stop talking to my daughter about money and “let her be a kid”?
Thanks for reading!!