The FINANCIAL — Often parents avoid talking to their children about money.
The FINANCIAL — Often parents avoid talking to their children about money. Partly this is because of a lack of knowledge about the topic, resulting from Georgia’s Soviet legacy, and partly it is because of a cultural discomfort with money. There is also a widespread feeling that children shouldn’t have to worry about the financial situation that their parents are in. Consequently, these parents make huge sacrifices for their children’s (financial) happiness, even if it means forsaking their own well-being, for a better future for their children.
As a result of this, I often see people well into their university years never having worked a day in their lives, living off their parents money. And when these students are in financial trouble, they ask their parents for money, not even considering the possibility of taking up part-time employment. This is a very damaging attitude, that can really hurt them in the longer term, because they will never learn how to fetch for themselves.
In fact, there is no trade off between wanting the best for your child, and teaching him or her about the value of money and hard work. The right attitude towards those two things can be a valuable asset for the rest of one’s life. Knowing how to deal with money will ensure that your children will be able to be financially independent in the future, while recognizing the value of hard work will allow them to develop themselves professionally, and develop a strong character.
I’ve interviewed many people who applied for jobs at our company. Many of them have university degrees from reputable Georgian or foreign universities, and often they are very intelligent. However, most of them have never really had a real job, by which I mean a job that instills in you the value of (physical) hard work: waiting tables, cleaning bathrooms, or being a construction worker. In Georgia, there seems to be a cultural stigma against these types of employment: if you’re from a good family and not poor, you don’t wait tables to finance your university education.
However, these jobs are valuable. First, they teach people about the merits of hard work, and the fact that not everything in life comes automatically. Second, they instill a sense of humility in youngsters. People often look down on these kinds of jobs, and working in one of them allows you to feel what it is like to be at the bottom of the totem pole. This is a good experience to have when you later climb that same pole.
The time to start teaching your children about the value of hard work is not when they enter university: the best time is actually their early childhood years. Start by asking your children to perform simple household tasks, and raise them as contributing members of the household, in order to avoid the “little prince” syndrome, which is especially prevalent among Georgian boys. It is good for a child to learn how to cook basic dishes, and to do simple cleaning. The simplest way to do this is often to tell your kid to take care of the room he or she sleeps in. As soon as they get to to their early teenage years, or perhaps even earlier, they can start to do simple jobs outside of the household, in order to make some pocket money, and learn what it’s like to work for money.
In addition to teaching your children about the value of hard work, it is also crucial to teach them about how to deal with money. One of the easiest ways to do this is to use a saving pig or something similar. Whenever your children receive money, either from work, or from gifts, they deposit it in the saving pig. They can then later use that cash to buy something that they really want. These can be very small amounts: the point is to create a habit of saving and to teach delayed gratification.
In fact, the skill of being able to delay gratification is one of the most powerful things that you can teach your offspring. In a now famous experiment that took place decades ago at Stanford University in California, children were given a marshmallow, but were promised two if they could hold off on eating the first one. Follow up research has shown that children who were able to delay gratification, e.g. who could wait and did not eat the first marshmallow, but waited until they got two, became more successful in life on a number of measures, such as test scores, decades later.
Once your children reach their teenage years, you can also start involving them in the household finances. Many parents do not like doing this, because they do not want to open up to their children about their financial situation, but it can be an excellent teaching tool. Show them how you manage your household budget, how any insurance that you have works, and how you save money, and allow them to ask questions about these things. This will be crucial knowledge once your children grow up and need to take care of themselves.
Teaching your children about hard work and money is one of the most valuable things that you can do for them. They will be eternally grateful for this, later in life, when they’ll be more financially secure, and successful in whatever they do, because of what you taught them.
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