I, personally, won't ever use the words "we can't afford it".  I feel that those exact words make kids worry about things that, as kids, they don't need to worry about.  If I tell them that we can't afford the $15 box of cereal that they want, that I know they won't eat after getting it home, they start to wonder what else we can't afford.

 I do, however, completely agree that we need to teach our children how to manage money.  If we don't, they are going to get out on their own and be so far in debt that they'll never be able to get out of it.  I think that teaching them spending habits and how to save is also a good idea and I need to be the one to show them that. 

 I'm learning this as they get older and smarter.

So, instead of telling my kids that we can't afford it, which I feel has a negative connotation to it, I simply tell them that it's not in the budget.

By changing my words, just a little bit, I've been able to open up the dialogue on budgeting as well as saving and spending wisely.

So far, it's working.

We'll see if it continues to.

Great post!

Heather

Desperately Seeking Sanity

http://www.desperatelyseekingsanity.com

Great post Shannon.

I'm a big believer in clothing allowances, which I think having four kids in six years (three of us girls) forced my parents to consider. And it worked -- we each got $X per month from which we had to buy any clothes we wanted in addition to anything else we wanted to buy (from magazine subscriptions to candy to movies with friends). This forced us to share re: hand-me-downs when we wanted to save for something special -- and we could buy things together too if we really wanted to. This saved my parents from being the bank, gave us a sense of responsibility and really taught us to bargain-hunt.

Lisa Stone
BlogHer Co-founder
Surfette

BlogHer is non-partisan but our bloggers aren't! Follow our coverage of Politics & News.

I think there is a difference between telling kids you can't afford something like $78 Z. Cavaricci jeans (yes, this is a true example) and exposing them to bigger financial problems that may cause them stress. When my parents told me that I could not have something and then explained why, it made me appreciate how hard they worked and what the value of money is. My family was lucky enough to be able to afford the basic necessities plus a little more. But if they could not afford something, we didn't buy it. They never had credit card debt that they could not pay in full when the bill came.

Again, I repeat that we were lucky to be able to live a decent life within our means. At the same time, my parents provided me with a great example of fiscal responsibility that I am proud to carry on today. While I would have loved to join the cool rich kids wearing their Z. Cavariccis, I think I came out better this way.

Suzanne Reisman, Contributing Editor - Feminism & Gender
Campaign for Unshaved Snatch (CUSS) & Other Rants

I agree that our children need to learn about budgeting, what's important to get and not in these times, and even when times are "good".  My children are only 5, 1 1/2 and 8.5 months so I don't get too much of the demand for expensive things.  However, we are cracking down on the toys, candies, etc that they might usually get in a store. 

I haven't used the "we can't afford it" statement (I agree that sometimes that can have a negative connotation), or even the "it's not in the budget" simply because they're too young.  What I have said is that "that's not what we're here for" or "it's not on our list".  So far so good.

~Mia.

My blog is General Hysteria~

I find the word no to be perfectly acceptable.  So many adults have not used that word effectivly that we don't even learn to tell people no when it is in our best interest.  I have no problem with a simple no.  I am not buying that.  I try to give my kids reasons but sometimes we also have to respect that fact that WE are in charge.  If we don't get that then how will our kids? 

As a single mom I simply cannot afford a lot of things that others can.  I have asked my kids would they rather me be at work or we have our Saturday morning breakfast, or Friday movie nights?  They often get that.  My middle one hates to be last in the afterschool pickup so I ask how long is he willing to stay at school so I can work?  As I said above it works sometimes and sometimes not.  I also make sure to use money around my children.  I rearly let them see me use a card.  I take them (3) to the store and make them shop so to speak and they watch as I give the lady the money.  This helps them get an understanding of how much things cost and how fast money goes.

Michelle

I blog at http://www.mommycan.blogspot.com/

Oops, I thought this was about the current budget crisis on Wall street.

My son is 12 and when he asks for something, one of the options for a response, is, "Well, that's a great idea, I'll bet you can figure out a way to earn the $$ to buy it yourself."  

I've learned from lots of wise women with terrific adult kids that when we give our children the opportunity to problem solve and figure out a way to earn what they want, it's more valuable than any object, toy or experience they can get.

This is what has worked for me:  We all have chores and responsibilities as a family.  Allowance is not tied to chores. $2.50 is the weekly allowance.  (Paltry, yes, it makes saving for something a long term process, and helps with decisions on where to spend the money.) We started this when he was 7.

He's figured out how to have lemonade stands, hot chocolate and graham cracker stands, sells extra fruits and flowers from our garden to neighbors, (we live in the suburbs, not on a farm), babysits the kids across the street and when he wants more money, he offers to do more substantial work around the house. 

And yes, sometimes he gets an unexpected game or object that he's mentioned in passing just because he's a great kid, who's a team player. This is such a happy surprise when it does happen, that I think he's willing to be the team player.

I agree that a straight and simple No is sometimes the best statement.

If we could find designer clothes at the discount stores that were within budget they could have them - if they had the fit I thought was appropriate.  My kids know that I never liked the idea of having someone else's name emblazoned on my clothes and I absolutely would not let them let tags show when that was the fashion in their teen years.

I used the fact that there were things I couldn't afford to help them learn to be responsible with their money and to look at careers that might allow them to make the kind of money so that they could get the things they wanted when they grew up.

I also cashed my check once and piled the bills on the table and we had to pay for them.  That showed them visibly where the money went and they began to come up with ways to help stretch the budget.  My daughter became a champion coupon clipper for groceries.  We worked together to save to go on vacation to visit the grandparents, etc.

They are obth realistic and responsive adults who know how to work within their means most of the time.

Tell the truth at the child's level of understanding and - watch how much of their TV diet features programs devoted to rabid consumerism.  Every want can't be had.

blog.candelariasilva.com

Good and plenty!

Budget crisis or not (and we are having our own in Canada, despite what the "experts" say), I think this is an important lesson to teach our kids right from the moment they are born. Our society has become so obsessed with posessions, that how can we even expect our kids to think differently?

My preteen daughter and I had to have this conversation just a few weeks ago. She had found some new things to decorate her bedroom well beyond our means. I sat her down and explained to her that there are just some things we can't afford to spend that much money on, and that we should look for similiar but less expensive alternatives. Was she disappointed? Sure. But to shelter our children from real life is doing them more of a disservice than worrying about how it may damage their egos when we dont' give them what we want. I don't expect her to "get it" now, but one day, she'll understand. And hopefully thank me for it!

Andrea @ Under Grace & Over Coffee

Not in the budget, not on the list...these the two phrases that all four of my children have me say, over and over again.  That's not to say that they are deprived.  Just, that they understand the difference between "want" and "need."  My two oldest both have steady babysitting gigs and make way more money than...well, you know...My husband and I have taught them well.  Because, now they give US an allowance ;o)  Great post, Shannon!

--------------------------------------------

This Full House

This Full House Reviews

Imperfect Parent

Who says "No!"  It comes in almost all of the various forms listed above, but I know that giving my son and daughter a sense of actual financial perception will be invaluble in the future.  I think about all of the kids (mostly my sister's kids) who go to the salon for $100 highlights, drive new cars, and such.  They honestly think they can do all of this on the salary they'll start with straight out of college. 

I'd much rather my kids do without, than be the credit crisis of the future. 

Julia

Thanks for the tips about helping our kids be fiscally responsible.  I agree that "We can't afford that" are not bad words.  My husband and I are in ministry, and there are lots of things that we 'can't afford', but that doesn't mean we suffer for it.  God provides MUCH more than we need, all the time.  For example, I can count on one hand the number of toys we've purchased for our son, but he has more toys (all given to us) than a whole daycare needs.

Some friends who are in a similar ministry tell their children that they can't have things because their family is 'poor', and the kids repeat it.  I think that's where you cross the line into breeding discontent and worry in your children's minds.  Overall, I think if you as a parent are content & have a cheerful attitude about your family's finances, instead of constantly wishing for more or complaining, that carries over into your kids' attitudes.

So funny, I posted about this topic on Allbusiness yesterday!

I read this in a magazine recently and I don't agree that we shouldn't share this with our children.  Sure, I wouldn't tell my daughters that we couldn't afford to pay the mortgage if we couldn't, but if we can't afford to buy XYZ just because my daughter wants it, I explain this to her.

I also explain the idea behind savings, and we practice this in our home regularly though she is only four. I believe learning this when I was a kid really helped me become a responsible financial decision maker.  I also believe it taught me the difference between needs and wants, and that I can't always get what I want when I want it.

Great post!

Kathy

Mama Marathoner

Allbusiness:Working Mothers

Shannon:

 I understand now where "we can't afford that" comes into play. vs. when to say "it's not in the budget" and I apologize if I didn't get the true meaning of it on my original comment.

Yes, you are right there are things that we CAN'T afford... and then there are things that are not in the budget.  I think that with my two, we've not yet asked for anything that I couldn't afford, but many things that are not in the budget.

Regardless, I'll stand on my original statement that we do need to teach our kids the importace of financial responsibility.  :D

Heather

Desperately Seeking Sanity

http://www.desperatelyseekingsanity.com

Hi Shannon,

What a great post, with very good advice.  I loved the story about the Mom explaining that the saleswoman made money if she sold the little girl something.

I would add that it's important to teach kids about commercials and advertising.  How what you see may not be what you get, and how ads and commercials are designed to make you think you need something when you may not.

Megan Smith
BlogHer Contributing Editor, TV/YouTube
Megan's Minute: Quirky Commentary Around The Clock

I am continuing in the shopping tradition started by my grandmother with my mother, and then my mother with me, and now me with my daughters: quality not quantity. I much prefer that they understand that to have something good, which can last a while, is better than just buying. This both makes them understand that purchases need to be considered and are not something to do just to do them. It also makes them value what we purchase and to realize that they better really like it, because it's going to be around a while. And with the ultimate control of the purse, they know that they won't get anything if they don't show to me that they have considered these points. They also know to always look at the sale rack first, and to comparison shop.

Two weeks ago my daughters went to the mall together to shop for dresses for an important family occasion: they knew to consider cost, and use in the future. I have to say, they did my grandmother proud.

Laura, www.rebelliousthoughtsofawoman.com

I am SO grateful my parents taught me the value of a dollar.  Even though they COULD afford it, the refrain in our home was 'you don't NEED it.'  If it was something over and above what we needed, then we had to come up with the cash for the item.  We also, never had allowances.  We were able to earn money by doing specific extra jobs or chore items, but routine chores were something that we did because we were part of the family, not because we got paid for them. 

This has instilled in me a very real understanding of the dollar that I have noticed is lacking in so many others.  I have countless (ok, maybe I could count them...) friends who spend every dollar of their paycheck to buy name brand clothes for themselves and their children, to buy new expensive cars and to be seen at trendy restaurants.  I just sit back in my thrift store jeans, with my used base model car and coupon clipped groceries and know that I will be secure in my future. 

It makes me sad for them, but it also makes me worried about who will be paying the price when their kids go to college, but they haven't saved any money to help, or if there's a medical emergency and they have no money for the bills, and what about when they're ready to retire???

Sorry for the rant...

April

www.AprilsLittleFamily.blogspot.com

I agree with all that's been said about teaching children financial responsibility and I am so grateful to my mom for the lessons she shared both explicitly and through her example.

However, I believe strongly that our words have power. To me saying "We can't afford it" limits what comes into our lives. I don't want my children to spend the rest of their lives in poverty (real or perceived) because they believe they can't afford something better.

I agree with the comments on helping children problem solve a way to get what they want. That's a valuable lesson as well. Our society is too entrenched in the instant-gratification mentality and a parents we need to be cycle-breakers for out children. There are opportunities that I missed in my adolescence because I was not prepared financially. While I may be sad about the missed opportunity, I have created opportunities since then because I had a clear vision of what I wanted and what it would take to get it. 

I think those lessons can be taught without also teaching the limiting belief of "We can't afford it."

Amber

CraftingInspiration.blogspot.com

We do tell our daughter we can't get something or do something right now.  We offer her the chance to earn money to buy things she wants or we have to plan how to take a trip. Our son doesn't understand yet, so we tell him we'll come back another day and get whatever he's asking for. He usually forgets about it. 

My parents did the same with me and I understand that some things were really out of reach for our family and not realistic.   

I usually remind my daughter that we can't just get what we want.  Things cost money.  We work to make money.  It's a concept she (4 years old) can grasp.  Her good behavior/helpfulness I reward with "points," which can later be used to buy something of her choice.  I think that we are bombarded by commercials, magazines, peers telling us what we should desire, but that tells me I have that power as well.  I make buying a used dvd at the library desirable, as well as used library books.  Books, a trip to the coffee shop for a muffin, a skirt or dress--these are all things she wants.  Of course, there are those times she wants Barbies or some horrific snack, but hey, sometimes you have to give them free reign.  They earned it, they spend it, but hopefully, most often, they'll spend it wisely.  

Great article!! 

--How to Party with an Infant

http://www.partywithaninfant.blogspot.com

http://www.kauiharthemmings.com 

I struggle with this issue and my daughter is not yet four.  I believe you have to start teaching kids about money at a young age; particularly in today's world.  It's too late when they're knee-deep in debt and trying to pay for college at the same time.  I think as long as you don't say it all the time, saying you "can't afford it" is a good life lesson.  There is a fine line between protecting our kids and sheltering them.  They shouldn't grow up thinking money grows on trees; that's not fair to them.

I will definitely use the clothing allowance when the time comes.  Thanks for this great post.

Mommy Wizdom

I always thought that starting the kids young with matters of money is a good way to ease them naturally into financial confidence and independence that will stay with them for life with endless benefits.  I talked to my kids about money as I would with adults and explained to them where it's coming from, how hard it is to come by and how it should be respected and used.  I guess in this context also explaining them the notion of afordability would be apropriate as long as they take it as a normal fact rather than something to worry about, and in that sense I see no problem in telling things as they are regarding stuff that we cannot afford at a given time.

As soon as they grew more and started to show interest in money and have more of it, I showed them the power and benefits of good budgeting not as a theory but as a method that I use myself to ensure that I am not living beyond my means and among other things can have extra money for them too.  I used to actually encourage them to keep a budget on paper which worked great but for my current teenager this time I discovered a great little free online budgeting utility that is a Godsend for parents who want to get their kids into the habit of budgeting.

It's called Out Of The Dark (OOTD) located on the web at:
http://www.myexp.org/OOTD_gate.php

I love how simple and easy it is to use and understand, and it is also anonymous to use.  I found it to be a good tool that helped me introduce budgeting in a way that does not feel like a big chore which can be a deal maker for teenagers.

Good luck.