We all want to see our children happy and comfortable, don’t we? And I’m sure there have been times that you just want to wrap your children up in a blanket and protect them from all the hardships the outside world can present. But you also know that if you do, you’re not doing them any kind of favor. It’s a far greater gift to teach them how to be self sufficient, especially financially.
And even though much progress has been made with women taking more control financially since the more traditional days, women still face a unique set of challenges when it comes to their financial lives. As such, there are many lessons to teach your daughters about money.
I have grown-up daughters of my own and I’ve instilled in them a fierce sense of independence. As I see it, there are a few key things to teach our daughters about money to give us, and them, peace of mind in knowing that they can fully manage their financial affairs throughout their lives.
Did you know that a study by a team at the University of Cambridge showed that kids have solid financial habits formed by age seven? Seven! Some can’t even tie their shoelaces unaided by then. But they can learn, intuitively, by watching you and your relationship with money.
So instead of leaving your daughters to just watch and learn, encourage their financial well-being with these three important lessons.
Lesson #1: Learn to Talk About It!
Is money really the last taboo? Many people find it hard to talk about money honestly and openly. That’s often because there is some sort of guilt and shame associated with either having too much, or too little of it.
It’s hard to balance a quest for comfort with feelings of greed and selfishness. And people who don’t have enough of it can feel like a failure – there are so many negative associations when thinking and talking about money. Just that alone can be so harmful and can help to form negative, damaging relationships with money.
By talking about these lessons to teach your daughters about money from the very outset, you’ll help to ensure they have a healthy attitude and a positive relationship with money. Perhaps more importantly, they’ll be able to talk to you when they need help.
Lesson #2: Teach Your Daughters the Value of Work
In other words, a man is not a plan.
While I know we all would love to see our daughters in rewarding and financially stable relationships, we know that the curve balls life occasionally throws at us mean that that is certainly not a given. And even in loving relationships, women can easily find themselves financially disempowered.
So we need to teach our daughters the value of working for their own money as early as possible. Encourage them to work for money both inside the house and outside – don’t give young girls an allowance for doing nothing. Let it be in exchange for help with household chores. If they want a special toy or a dress, let them save up for it and experience the satisfaction of achieving their goal.
If your daughter wants a car when she turns 16, set some boundaries. Tell her how much you’re willing or able to contribute towards it, and help her figure out how she can make up the difference. Make sure she’s working for what she wants as setting achievable savings goals is one of the greatest lessons we can teach our daughters about managing resources.
Isn’t that what we’d all want for our kids, especially our daughters? We owe it to our daughters to help them become financially independent, with all the freedoms that brings with it.
Lesson #3: Teach Your Daughters How to Budget
To assist them with building up savings, help them first to learn to budget. Read a budgeting book with your daughters, or encourage them to go online and find some good resources. By helping your daughters to incorporate spending, sharing and saving into their day-to-day financial affairs, you can set them on the right track for financial independence.
Here’s an example you can start with when they’re young. Provide them with a certain amount of money to use to buy all their school supplies, and make it clear that those are all of the funds they will have. Entrust them with the decisions of where to buy what they need and how much to spend on what. They’re bound to engage with this carefully, as they won’t want to go without must-have items.
When my eldest daughter was 14, she kept on asking me for more and more money to buy clothes and I was tired of being nickeled and dimed to death, so I gave her a lump sum to purchase everything from clothes, undergarments, and shoes and she was responsible for managing it. All of a sudden, she no longer focused on brand name items, and TJ Maxx, Target and Walmart became her favorite stores. Your daughters will learn how to stretch the dollars!
When they have more income, teach them to spend a portion, save a portion and share a portion of their money. Not only will this mean they build up savings, but they’ll build up invaluable confidence in their ability to manage their own money as well as the importance of giving back.
Teaching Our Daughters About Money: A Life Skill
I see so many clients in transitional stages of their lives, suddenly facing new financial challenges. The world has evolved rapidly – over just a couple of generations, women’s lives have changed immeasurably.
Nevertheless, by equipping our daughters with a few basic, lifelong financial skills we can be sure that we’re sending them off into the world as financially confident, empowered and independent women. It has never been more important to integrate into your life these lessons to teach your daughters about money.
If you’d like to learn more about managing your finances yourself, or you’d like some advice about planning for your daughters’ futures, reach out for a consultation. We’ll be thrilled to hear from you.