Sharing Financial Status with Teenagers: A Parent's Perspective

As parents, we often grapple with the question of whether to share our financial status with our teenagers. While some parents may feel the need to be completely transparent, others might prefer to shield their children from such details. In this article, I will share my perspective on this issue based on my personal experience and observations.

Why Not Share Financial Status?

While our grown son has reached adulthood, I personally do not share my financial status with teenagers, at least not until they are significantly older. At this stage, teenagers often lack the understanding of what it takes to run a household. Expenses such as insurance, mortgage payments, and groceries are often seen as general costs, rather than the specific contributions that come with owning a home. Moreover, teenagers tend to view most income as disposable, equating it directly to their personal enjoyment and immediate gratification.

Reality hits us differently as adults. We must manage our finances carefully, recognizing that income doesn't always cover expenses. This is a lesson that we, as parents, must ensure our children learn. Instead of sharing our exact financial status, we focus on training them to manage and handle money responsibly.

Developing Financial Literacy

One of the best ways to teach financial skills is by letting our children actually handle money. Encouraging them to take on part-time jobs and establish a budget for necessary expenses is a step in the right direction. By having them pay for expenses such as a mobile phone or entertainment, they start to understand the value of money and the importance of making wise decisions.

We also emphasize the concept of saving for big purchases. Discussing plans for the future, such as buying a car or saving for college, helps them see the bigger picture. Additionally, offering the opportunity to earn more by completing additional chores around the house can teach them the value of hard work and the rewards that come with it.

Setting Budgets and Expectations

When my children began planning for college, we discussed their budget and the financial support we could provide. As a gig worker, my income was unpredictable, which I explained to them. We emphasized the importance of budgeting for living expenses and encouraged them to plan accordingly.

Using a whiteboard on the fridge to track expenses was a useful tool. Initially, this was a learning experience for my children as they discovered that essential services like water and electricity don't just appear out of thin air. Over time, this habit has evolved, and my children have grown accustomed to the volatility of freelance income. They understand that while they can ask for what they want, not all requests can be fulfilled.

Empowering Through Transparency

Since I work from home, my children see me working and have a clearer understanding of what I do for a living. This transparency helps bridge the gap between their conceptual understanding of income and the reality of managing finances. I answer any questions they have, which reinforces the importance of lifelong learning and financial responsibility.

Conclusion

While there is no one-size-fits-all approach to sharing financial status with teenagers, providing them with the tools to manage money responsibly is key. By starting early and building on their experiences, we can equip our children with the financial literacy they need to thrive in adulthood. In the end, the goal is to enable them to make informed decisions and take responsibility for their financial well-being.