Ron Lieber is the “Your Money” columnist for The New York Times and an award-winning journalist. He recently published The Opposite of Spoiled: Raising Kids Who Are Grounded, Generous, and Smart About Money.
Any tips on how parents can start conversations about money with their kids? Well I think the first thing you need to stop and do is remind yourself to be open to the questions in the first place because it’s so tempting to shoo our kids away or shush them or shame them when they ask money questions. The fact of the matter is that money is a source of enormous power in our world but also a source of mystery for kids, precisely because grown-ups don’t talk about it enough. We need to be prepared to give our kids honest answers to the questions and don’t make them feel bad for asking.
Should kids start earning their own money early on? When I think about jobs, I think about work that you do for somebody that you’re not related to for which you get paid—not household chores. I think every child should have at least one job, preferably a full-time job that they take on in the summer sometime during high school, and preferably every summer. I think every child should contribute, hopefully substantially, to the cost of their undergraduate education, and I think there’s something developmentally profound about having to show up someplace every day, where a team of other people or customers are relying on you and learning what it means to perform that task or a set of tasks for a wage where there’s a possibility that you’ll be kicked out by a boss if you’re not doing the things that you’re supposed to do.
What’s your view on giving kids an allowance? Allowance is for practice, and money is something we want our kids to get good at. We should think about it in the same way that we should think about a musical instrument, or art supplies, or athletic equipment, and as with those things, or books, these are not things that we take away generally if our kids have not done their chores. I think the allowance should be given out without any conditions except that the money gets used responsibly, that you don’t lose it or burn it, and that you don’t buy anything or do anything with the money that is on the family’s banned-items list. As long as you follow all those rules, the allowance is yours.
For parents who are tired of being nagged all the time for stuff, the quickest way to nip that in the bud is to actually double your child’s allowance if you can afford it, which may seem like a counterintuitive approach. But once it’s clear to them that they have this sum of money—but that until further notice, every single thing that they want as opposed to things that they need is going to have to come out of the allowance—then there’s no reason to bug you anymore because they know that the answer is going to be, “No, that’s what the allowance money is for.” Whatever that allowance is, they have to make that last and parcel it out and make tradeoffs around the things that they want the most.
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