Are You Your Child’s A.T.M.?
By LISA BELKIN
Times are tough. Kids should be learning harsh financial truths right about now, no? Lessons learned: Money doesn’t grow on trees, nor is there an endless supply in Mom or Dad’s wallet, right?
Not necessarily. A survey by the Northwestern Mutual Foundation, conducted on its financial literacy site, themint.org, finds that today’s parents are “incredibly lenient” about handing their children extra money. The lesson that is being taught, the foundation warns, is one of immediate gratification rather than budgeting or financial discipline. The survey asked children, ages 17 and younger, “How often did your parents say ‘O.K.’ when you asked for extra money beyond an allowance”; 63 percent answered “always” while 26 percent said “sometimes” and 6 percent said “never.” Only 5 percent of children said they had never asked. And how does this compare with earlier generations? Among adults, ages 18 to 45, 12 percent agreed with the statements “I always got extra money beyond an allowance from my parents when I asked”; among adults ages 46 to 59, 8 percent agreed; among adults 60 and older, 13 percent agreed.
The reasons kids want this extra money appears to be changing, too. Today’s teens say they spend it on tickets to movies, concerts and sporting events (40 percent), food and drink (24 percent) and toys and games and phones (19 percent). Only 15 percent said they wanted something for school, compared with 47 percent of adults over 60 who gave education as their reason for asking for extra money when they were young.
It could be, of course, that memory and perception are in play here. But the numbers are dramatic enough to make you think about whether today’s parents open their wallets too easily and too often.I personally recognize a changed family dynamic in these statistics.
Students: Share how this issue plays out your family — and whether you are learning money management skills like budgeting. Do you believe in getting an allowance? Do you ever need more money? If so, why? How do you think your family could do better in terms of teaching you how to deal with money issues, or how are they doing well? What advice do you have for younger children who are just starting to be responsible for handling money?
(Want some advice on how to structure allowance, and not cave when their allowance runs out? TheMint.org has a guide here.)