The words family and budget are not often seen together. As parents, you may have questions about how much you should get your children involved in family finances. I feel strongly about using your home as an incubator for real life money issues. Otherwise, its hard to expect your kids to grow up to understand the real world of money.
Budgeting is not an area of life that needs to be hidden. Why should it be? You would never be able to function in a business in which you didnt have a least a good grasp of the budget and how you fit in with the total package. And, believe it or not, a family is a much closer unit than a business.
In a time when people seem to have no compunction about going on social media and discussing what used to be considered the most embarrassing and personal details of their sex lives, we still shrink in horror when addressing anything about our financial lives. Thats too personal. Thats private. Thats nobodys business; its between me and my family.
And, frequently, the topic of money is even taboo within the family.
The Secret Of Money In The Family
Why dont we discuss money with our children? There seem to be a variety of reasons. We may want to protect our children from growing up too fast, having to learn about the harsh financial realities of life. Sometimes we dont want our children to know how little we make because were afraid theyll think less of us. We may consider what we earn as lifes report card, and we may be getting failing grades in their eyes, as compared to others. Or, other times, we dont want our children to know how much we make because were afraid theyll want us to buy them more.
Whatever the reason we dont want to talk about money, it seems as if were taught not to; money is just something nice people dont talk about.
Bringing The Family Together On Budgeting
Working out a budget should be a family project. The activity of paying bills and planning purchases will bring the family together in meaningful ways. It gives your kids a sense of the value of things, and of the very real problems of making ends meet. Budgeting also shows them what decisions need to be made in real life. The following activities will give your children a share of and a stake in family responsibility.
Theres no reason why, when your kids get to be 11 or 12-years-old, they cant be included in the family bill-paying project. If the family sits down and pays its bill together, it creates a real awareness of how a family works, how money works, and how real choices are made. You can gather around the kitchen table with a pencil and paper or around the computer, using todays leading software. The most important aspect is that youre working on a budget as a family.
First, the kids need to understand your net and gross income. Show them your paycheck and the different taxes that are paid. Then, with the remaining money, you have to make choices. Make a list of all the fixed expenses, such as the mortgage or rent. Other items on the list may include car payment(s), health insurance, retirement and college savings, and utilities. After youve deducted these items, variable expenses such as household items, gifts, and vacations are up for debate. I hope that is a lively one.
Your upcoming vacation is a fantastic budgeting project, which should include the whole family. The conversation shouldnt just be limited to where do you want to go? Discuss every aspect of your vacation expenses and the value received for your vacation dollars.
How much of the vacation budget will be spent getting there? Will a specialized wardrobe or equipment be needed for the vacation? This can open up a detailed conversation within the family of different kinds of value. What will the family be getting in return for its vacation dollars? Will there be more than one dimension to the trip? Will it be educational?