The old clichés hold true time and time again: there’s nothing out there that’s truly free, and “you can’t always get what you want.” This is a hard lesson to learn even as we grow older, but it’s something we can start teaching our kids as early as elementary-school age up into the teens. Here’s some straightforward methods for explaining what one might have to give up (“owe”) to get something now (“want”) from the perspective of what you might say to your child during the conversation.
For Elementary Ages:
“Have you ever wanted a doughnut or ice cream so badly that you could not think of anything else? In fact, I bet you even offered to do extra chores or give up Christmas presents just to get that Signature Creation from Cold Stone Creamery, huh? If you were successful in pleading for your amazing treat, how did you feel about having to follow-through with your promise to wash mom’s car or put the dishes away for a whole week? That part wasn’t so great, right?”
“Well, did you know adults do the same thing to themselves? They will want something so bad that they will do things they know they’ll regret in order to get the thing they want. Like having to do the dishes! Adults will use money that is meant to be spent on something else far more important, or they’ll borrow money through credit cards.”
“After they buy what it is they want, how do you think these adults feel about their decision to go “outside the budget?” (About as crummy as you felt as you were washing the windows for the third day in a row and your ice cream dreams had long passed.)”
“It is important that you learn to not chase the “wants” that require you to “owe” someone. Sometimes, it’s better to want something than to owe someone.
For Middle Schoolers / Teens:
“Let’s think about last week’s exercise of ‘Fast Forwarding’ our year to see how we did on our goals. The key things to remember here are LIVING, SAVING, and GIVING. Did you have less to LIVE on than you hoped, because you spent too much or did not save enough money? It’s okay if you did! Many people feel that way, even adults. Sometimes, adults will take money from SAVE or GIVE in order to have more money in LIVE. In fact, some people will even borrow money in order to LIVE more.
But — you are different. You already know that the true meaning of “rich” is having breathing room in your finances. Plus, you know how to make good decisions based on “What’s the wise thing to do?” rather than just what makes you happy now – this is known as delayed gratification, and it can pay off financially in the long run.
So, when it comes to planning and creating a budget, stick with only buying what you can afford without borrowing or “stealing” from your other goals. It’s okay to want things! Most people do, even famous YouTube stars and celebrities. Virtually nobody can have everything they want, and has limited resources. For those of us who are not rich and famous, though – if you take from other goals or borrow money to get something you want (but can’t really afford) you also acquire a debt – in other words, you owe someone – and you’ll regret that. And that regret is far worse than not satisfying the want in the first place.”
Additional Tips for Parents:
It’s easier to show kids that it’s perfectly okay to “want” things – rather than sacrifice their goals and “owe” to obtain them – if you share examples of your own. Give an example where you did not show restraint (for example, buying the upgraded sport model) and another when you did (opting for the more practical option and growing the savings account instead of increasing your vehicle loan). Tell them how you felt about each decision afterwards. Like always, help them understand the emotion tied to these examples, and the financial impact they have as well.
Give each kid 4 strips of paper. Have them write a movie title on one, a famous person on one, a famous place on one and a famous song on the last one. Put your strips and their strips in a bucket or hat. Take turns pulling random strips and performing charades for one minute each. See who can elicit the most correct responses. Break into teams if you have 4 or more players.