Does anyone else worry about this with their kids?

[MotoDad]

My daughter is 17. We sent her to a private school and busted our asses *excuse me* to get her the best education possible. One thing I never intended was the whole “keep up with the joneses” mentality. She is smart, and a hard worker, I just feel like we have failed her as far as teaching her about finances and saving money, partly because we don’t.
She works, but any time she has money she just “buys buys buys”. It’s frustrating because she clearly has the desire to live out of her means. I have tried to instill the notion of saving and investing towards her future and it simply does not strike a chord with her at all. I just don’t want her to be struggling like we did with her and her brother.
I am looking for suggestions because my son is about to be 12 years old and I want to nip the problem in the bud before he starts the same thing. Luckily my daughter has no credit cards, but who knows when she goes to college… she wants a high limit credit card real bad.
My question is:
1) How can I help my daughter break this cycle of spending till nothing is left?
2) How can I teach my son about the importance of saving, financial stability and investment?

[FearlessLeader]

honestly? if she's smart and a hard worker, i say it's her money and her right to spend it if she wants to. I'm sure when there's something big she wants, she'll learn pretty quick ;) what about offering to go halves in a car for her 18th, match her dollar for dollar (if you can afford to that is!)

Eta oops sorry for crashing the dad's section :o

[OJandMe]

1:- send her overseas to work in an aid organisation for a year and see how children live in rubbish tips and have NOTHING... and a grateful for ANYTHING.

2. Don't give him his pocket money... tell him he can have 'X' amount, but "x' must be saved and put into a bank account that you hold in trust, 'x' must be donated (maybe sponsor a child or something, get him to choose a cause he thinks is important) and 'x' can be spent.

[TripleTime]

I say let her go for. She'll soon learn if she wants something you have to save for it. Nothing is handed to you in the big wide world.

[chameleon]

Learn the hard way I guess? I know my sister did that too (spent all her money) and Mum would always end up giving us more when we ran out. My sister is now 21, still lives at home, no job and Mum still pays for everything.:rolleyes: Drives me mad. So I suppose let her spend it how she wants, but don't then help her out if she needs money for a phone bill and has none left and make sure you aren't buying things for her. If she needs something or wants something (car, phone, etc) she will have to learn to pay for it and everything that comes with it.

Not sure how to teach your son the importance of it. Maybe even talking to him about what he wants from his life in the future, and starting to help him think about how he will achieve those financial goals? Even start putting aside small amounts now? I know my husband started saving for his dream car when he was really young, and now he is doing so well for himself.

Oh and be careful with the car thing, matching her dollar for dollar. My Mum did that with me, and it did work! I saved! But ended up saving $12,000 so Mum then had to put $12,000 towards my first car. So I think that one backfired on Mum a little.

[Bell & Bug]

Let her go for it. I had people on my back about saving, practically forcing me to save, and I resented them so much for it.
I learnt from my mistakes and learnt pretty fast about saving money. I would save 50% of my pay every week. I had my bank automatically transfer the money over to an account I couldn't access with my key card.

I know its hard to just sit back and watch her make what you deem to be mistakes, but it is her money, she worked for it, so she can do what she wants with it.

Though it can't hurt to steer her in the right direction, maybe make the suggestion that she saves x amount of her pay, and maybe give her an incentive to save too, like when she has saved x amount then you will add to it and so on?

With your son, well that's easy, if he doesn't have an account yet, get him one, and tell him you will put some or all his pocket money in to the account, and do the same as with your daughter, once he has saved x amount of money, then you will add to it.

[chameleon]

Just wanted to add, I guess the bonus of teaching them the hard way now, is that they might learn the value of money BEFORE they get the credit cards and the loans and end up in real financial trouble. Better to learn with smaller things like phone bills/car rego...

[Bell & Bug]

Learn the hard way I guess? I know my sister did that too (spent all her money) and Mum would always end up giving us more when we ran out. My sister is now 21, still lives at home, no job and Mum still pays for everything.:rolleyes: Drives me mad. So I suppose let her spend it how she wants, but don't then help her out if she needs money for a phone bill and has none left and make sure you aren't buying things for her. If she needs something or wants something (car, phone, etc) she will have to learn to pay for it and everything that comes with it.

Oh and be careful with the car thing, matching her dollar for dollar. My Mum did that with me, and it did work! I saved! But ended up saving $12,000 so Mum then had to put $12,000 towards my first car. So I think that one backfired on Mum a little.

I agree, don't give her extra money for phone credit, phone bills, transport, outings etc. That will definately help. My parents did this to me to some extent.
Same with the dollar for dollar, I wouldn't do that, but giving her a different but similar incentive such as you save x amount, ill add to it x amount (so maybe she saves $200, you'll add $50)

[poppyseed]

I like the last posters suggestion - if she saves $200 maybe contribute $20.
I wld see if she has any goals that she wants to work towards, I.e car, schoolies, overseas, move out when she finishes school, etc? Work with her on budgeting, show her the importance of money, how to pay for things like bills yet still have money to buy what u want.
U cld start this with ur son also, what wld he like to 'save' for in the short term i.e a game, movies, etc.
Hope that helps :)

[NancyBlackett]

My bestie had a part time job at school and used to spend it all. After a few years though she decided she wanted to go overseas so had to save and save hard. She's now amazing with money and v frugal.

I think at 17 she's still saveable :)

[motheroffour]

about 5 years ago when ds was 9 and dd was 6 I was putting money away for them to spend on big items, well dd spent hers when ever we went out but ds saved his until he had enough for a great bike, now he is 14 and has bought 3 computers(up grades) and is saving for a trip to Melbourne, plus he finds work doing mowing for his granddad and he is my dishy at work. yet dd gets pocket money (she lives with me ds lives with his dad mostly) for her work around the house but guess what, her money box is always empty, hopefully one day she will learn.

[BiggerNotSmarter]

I really think in your dd's case you need to treat her like an adult. If she's earned the money it's up to her how she wants to spend it. I don't think it will be effective to tell her to save $X per pay because at the moment she doesn't need to.

What you CAN do is make it clear what her financial responsibilities are. For example, you could start charging her rent once she's 18, let her know that she needs to pay her own way through uni, etc. And like others have said, don't bail her out ever.

With your ds, I'm a big believer in denying kids things sometimes just for its own sake. Sounds mean, but if they have everything they want all the time they might not learn about delayed gratification. I think this is the key concept - you don't always get what you want as soon as you want it.

Cheers
Biggy

[Dadspin4]

Jumping in here. My kids are younger. We're trying to teach them now. Or really let them teach themselves, so I joined up with Kidworth.com. My sons pick things they want to buy, we log how much money they have saved, they have to see what they can actually afford. And we let them make buttons for college savings and donations. When they feel like they are managing their own money, it suddenly becomes very important.

[backgroundnoise]

*crashes through a little later than everyone*

Haha, I'm 18 and have really only recently grasped the concept of saving. I worked hard to get my money and then had to spend it on groceries and petrol so I learned that way that if I want to do anything else I need to budget and save. Perhaps make her have some of those sort of responsibilities?