Common Parenting Behaviours That Affect A Child's Future Financially (2024)

Common Parenting Behaviours That Affect A Child's Future Financially

Parenting is a subject that we can all relate to in our way or another.

The thing about parenting though is that you never know how challenging it is until you’re in the driving seat yourself.

It remains one of the most challenging things I have ever taken on.

I’ve previously written about the real cost of raising a child and real joy of raising a child.

One of the biggest Millennial trends at present is that Millennials are starting to have children.

This collides beautifully with the other major Millennial trend, which is that Millennials value experiences.

As such, the subjects of parenting and money have never been more important to this group.

Although this post applies to a broader audience, I’m drawing attention to this group because they still have time to change things up.

As a Millennial parent myself, I’d be lying if I told you that I don’t often consider how my parenting approach and relationship with money might affect our kids.

It has never been easier to spend money in today’s digital world.

With kids now exposed to a variety of digital devices, it has never been easier for children to want this gadget or that latest toy!

I feel like we are always fighting the resistance with our kids and there is no manual to guide us on best parenting.

Even if there was a manual, doing what it says is always harder in practice.

Today I welcome a guest post that I hope will give us ideas for better parenting of our children.

I’ll now hand over to Nelly Good to shed some light on parenting behaviours that could negatively affect a child’s future financially.

Parenting Behaviours

It is a universally known that parenting styles have a huge impact on a child’s mental development, thereby affecting a child’s behaviour till they reach adulthood.

By the same vein, certain parenting behaviours when it comes to money can negatively affect a child’s future financial life.

Children learn a lot by watching and imitating their parents.

Therefore, to bring up a financially healthy child, you need to manage your finances with deliberate care.

As a parent, it is your responsibility to practice healthy financial habits to teach your kids how to manage money in the future.

Here are a few parenting behaviours and mistakes that can negatively affect your child financially in their life.

The goal here is to consider these and where possible, ask yourself the important questions and take action.

Not Planning A Budget Properly

When you don’t use a budget, it’s hard to differentiate between needs and wants and you end up buying things driven by feelings.

By seeing this over time, your child doesn't learn to differentiate needs from wants.

This could potentially lead to the irresponsible management of money, or worst still, debt problems.

Whilst budgeting might not always be a fun activity, visually, it helps to remind a child that managing money well requires restraint.

Related post: How To Create A Budget That Works For You

Helicopter Parenting

Helicopter Parenting is what happens when parents hover over their children all the time like a helicopter.

When you become overprotective about your child, you might even find yourself doing their work.

You even start protecting your kid from every hardship.

This aspect of helicopter parenting is referred to as Overcompensation.

Parents who do this often do it to remedy a deficiency in their own upbringing.

In doing so, they potentially stop their child from taking on financial responsibilities.

A good example of this is what happens when parents help their children to buy their first home with significant deposits.

Whilst this could be viewed as helping your child get onto the property ladder, it also compounds a possible sense of entitlement.

Even if you could help your child to buy a house, make sure some of it is a loan and your child pays back the amount.

Parenting Books We Love:

• Raising Boys by Steve Biddulph
• Raising Girls by Steve Biddulph

Not Paying Attention To Your Marital Life

One of the major reasons for divorce nowadays is that parents neglect their spouse to satisfy the demands of the children.

Apart from impacting one’s mental health, a divorce can lead to financial problems too.

More often than not, these financial problems negatively affect a child’s life, especially if one has to raise a child as a single parent.

So I’d highly recommend some ‘me’ time and ‘we’ time to enjoy your life and to nurture your marital life.

If both of you share a good relationship, it will help the child to grow in a healthy environment.

The same applies if you’re a single parent.

Have some time to yourself as being a parent doesn’t mean that you’d have to entertain your child all the time.

They need to be by themselves sometimes. It will help them to be more confident to make their own decisions in life.

Spoiling Children With Fancy Things

There is nothing wrong in buying gifts for children.

We always show our love in the form of gifts while welcoming a new member of the family.

However, for a lot of parents, it doesn’t stop there.

Often parents splurge with kids with lots of fancy stuff especially during birthdays, etc.

Ever realised that while doing so, you make your child used to such things and they start to think that this is normal?

They get used to such expensive gifts right from childhood.

So, unknowingly, parents set the bar for future unrealistic expectations of their children.

This is often one that parents realise (if they do at all) when it is too late.

So, what can you do?

Help your child to understand the true value of money.

They need to understand that it requires hard work to earn and therefore should value money.

When your child asks for something, ask them to save the amount first.

By doing so, they will automatically understand the value of savings, that they need to save first to buy things.

Using Credit Cards Regularly In Front Of Your Child

Have you ever asked your children where money comes from?

Chances are, depending on their ages, they’ll think it “comes from the bank” or “from the card”.

Raising children in a world of mostly digital money has a negative impact on behaviour.

Every time they see that you are paying with credit cards instead of cash, they might think that it’s easy to buy items of their choice.

Similarly, when you use an ATM and your child accompanies you, it’s easy for them to think you can take out money whenever you feel like.

So, even if you’re taking your kids to withdraw an amount from an ATM, make sure you explain to them that you need to put a lot of hard work to deposit the money into a bank and so the money is coming out.

From a young age, encourage your child to do small chores at home and in return, give them little allowances.

They will understand that you need to put effort to earn money.

However, do not give big amounts to the preschoolers. Give small amounts and ask them to manage the money properly.

For example, if you gave a child £3, splitting it into 3 buckets of £1 to save, £1 to give and £1 to spend is a good rule of thumb.

It’s easy enough to remember whilst also getting across important principles around saving and giving.

Replacing Quality Time With Gifts

Nowadays, parents feel the guilt of not giving enough time to their children.

To make it up, they give gifts to their children to make them happy.

But, this is far from being the best parenting technique.

Being busy in the modern age is understandable, but it helps to really ask yourself- What exactly are you busy doing?

Doing this helps you get to the root cause rather than trying to solve problems temporarily.

A good way to figure out what you’re spending time on is to audit your time for a day or a week.

I’ve done this in my personal life and found that truth be told, I had more time than I thought.

Pockets of time can be found from taking a break from digital devices and social media, for example.

Then reinvest this quality time with your child with no distractions.

I’ve personally found that children prefer quality time doing something fun to gifts any day!

You can engage in some activities which both of you enjoy.

This could be anything from reading to build crafts or doing sport.

Such quality times give you an opportunity to really listen to your child and build a stronger bond.

Lack of Communication

It’s not uncommon for parents to face financial trouble and hide it from their children.

They either do this as a way to protect their children from worry or they do it out of guilt or shame.

Some parents even take out loans to fulfill the demands of their children, further getting themselves into financial trouble.

The choice of whether to make your children aware of financial issues is a difficult.

For really young children, certainly not as the chances are they’ll not understand.

However, for children that are a bit grown up (12 years +), keeping such information from them could be to their disadvantage.

As painful as it might be, it helps to explain your present financial situation to your children.

Involve them when you’re trying to find a suitable solution to overcome problems such as debt.

By doing so, it will encourage them to avoid debt as they grow up or at least learn how to get out of debt if it happens.

Not Giving Your Children Financial Education

If you’re thinking that your child is not old enough to learn about money, then you’re wrong.

My experience is that the earlier you introduce the concepts to a child, the better.

Start as early as preschool in age appropriate ways.

For example, you start with distinguishing between money denominations of 1p, 2p, 5p, 10p, £1, £2, etc.

Where possible, make it fun and turn it into a game of coins and notes.

Such activities are a good introduction to children that not all monies are equal.

Taking various amounts to the shop and buying something is also a practical way to demonstrate the exchange of value.

Another thing you can start doing right from the young age is encouraging them to earn by doing small household work.

Doing so, helps them to make the connection between work and money.

To conclude,

Managing money and parenting are both hard work! No doubt.

However, it takes being conscious of our daily actions and parenting styles for us to make the right decisions around our children.

The best place for your child to learn about money and life is at home.

If you see things from this perspective, it magnifies the important role you have to play to ensure they have a healthy financial future.

Good practices such as living within your means, budgeting, avoid credit, etc have stood the test of time for a reason.

Our jobs as parents is to make sure that we do what it takes to pass these on to our kids and raise financially responsible and intelligent children for tomorrow.

Author’s Bio: Good Nelly is a money blogger with expertise in credit, debt, insurance, and mortgage related matters. She maintains a blog at My Way Of Viewing.

What To Read Next:

• The Real Cost of Raising a Child
• How To Get Your Kids Interest In Money Management
• The Real Joy of Raising a Child
• How We Live Well On a £50/Week Food Budget (Family of 4)

What do you find most difficult about parenting? What are you doing to teach your child about money?

Do please share this post if you found it useful, and remember, in all things be thankful and Seek Joy.