Place Oxygen Mask Over Your Face Before Helping Children

Remember your last flight? You know, when the flight attendant briefs you on putting the oxygen mask over your face before helping your children. Why is that? Because if you pass out for lack of oxygen, fiddling with trying to help your kids...neither of you will be helped. The same goes for kids and money. This post is especially for you folks with teens in the house. Before handing out your next chunk of change to your kid, remember this.

• Being overgenerous with your kids will actually backfire on your child. Your child will think money does not need to be earned and that it grows on trees. They will forever have a screwed up vision of money and managing their life.

• When you give your teen or adult child money, will it speed up or prolong their dependency? If you are constantly bailing them out and giving them a hand out, how will they learn to be independent? If you have a situation where you can give them money to get them to the next level, then by all means, do it. I just want you to go through this thought process before handing it out...every time, thinking you are helping them, when you may in fact not be.
  

• There is a better chance of your kid somehow finding money for college (work/study programs, scholarships, grants) than you later finding money to fund your retirement. Your retirement should come first, then save for college. You don't want to be a burden to your kids when you are older than dirt do you? Save now so this won't happen to your family.

• Foster responsibility and independence early on. Teach your kids that the decisions and habits they have now can and will have consequences. Didn't do your homework, well, then no tv today? Didn't clean the cat litter box? Sorry, you won't be able to go over to Johnny's house today. Start this early and when they are young, and you won't have a problem later on when teenage hormones start affecting their brainwaves!

• Encourage your kids to save early on. Our kids do not get toys and junk unless it is Christmas or their birthday. And you know what, they don't ask for anything, except around those times of year..and they have had a bright and fulfilling childhood. When they do get a surprise gift at any other time, they truly are surprised and appreciate it more. If they really, really want something, I encourage them to cut out a photo, write down the price, and start saving. If it's something high priced, I might even offer to match what they can save up.

How do you deal with your kids when they have a case of the gimmies? How do you go about with money and your children?

Added 5/7/2008:

Another thought, how about matching your child's savings? I know someone who opened up an IRA for their teenager. Every dollar that child puts into that account from her waitressing job, the parents are matching it...what an incentive! You can also do this with your child's piggy bank. Every time she decided to put the money in there rather than spend it, you can match it. I like that.