Materialistic Parents Raise Materialistic Kids

Financial Habits of the New Generation - Why Our Kids Are So Materialistic

Advice Seeker: Dear April,

I feel like my kids just want, want, want. They have no concept of spending yet are so consumed by the idea of money. I suppose all children have a desire for the new or what their friend's have, but I don't know how early is too early to teach your children about money.

Sincerely,

Money Mommy

April Masini's advice:

Dear Money Mommy,

It's not the kids that are different -- it's the parents. Especially when it comes to money as a tool.

Kids still want what they see around them. If they see a great toy at a friend's house, they want it. It's really up to parents to teach children about coveting things, good values, and planning how to spend money to stay within a family budget or a kid's allowance budget.

And they've failed.

Parents want so much more than they used to -- that they fall into debt, they cede control and raising of their children to schools, nannies and other entities, they push their children past childhood limits over-scheduling and over-sexualizing their kids and they don't understand why kids boomerang back into their parents homes or become Gen X, Y and Z.

One of the most interesting dilemmas parents face is paying kids for getting good grades. It is an interesting choice of ways to teach kids about money that has pros and cons.

* Replace character with money. One of the things that paying kids for getting good grades does is to replace character and value with a payment plan. Instead of teaching children to do the right thing, or to get good grades because it's a way to have a better life, or to try and achieve good grades because it's what parents and teachers are asking students to do, parents replace good values with good money.

* When is the right time to teach money as reward? Making money is a good thing when it's made honestly. It's also an important tool in life. Paying for grades is not a bad lesson -- but when it's taught in elementary school, the child is not offered the lesson to do the right thing for the sake of doing the right thing. That said, life is full of behavior and consequences. When a baby smiles at us, we reward that baby with affection and attention. A baby who does not smile as much is not as rewarded. A child who achieves -- by taking a first step, speaking a first word, or doing any number of things parents wait for their children to do -- is rewarded with non-monetary gifts like affection and presents.

* Don't make money the only motivation. If you do choose to reward your child with money for grades, soccer goals or not dating until a certain age, make sure that money is not the only motivator you use. Make it clear that being part of a family requires everyone to pitch in whether they're paid or not.