Teaching your kids to be money wise??

As the return of my eldest daughter (9 months travelling) gets nearer and nearer I’ve been thinking of ways we can teach our children to be sensible with money. I’m not looking to teach them to be totally frugal, just sensible would be enough.
My daughter is coming home with £2500 worth of debt that she owes me, my bf and a credit card. She delayed university for two years one because of a serious illness and then to go travelling. Now I’m not sure that she will go this year either. Anyway she is back to work in July to start paying off the debt. What really worries me is that she is just like me (or the former me) and can’t wait for anything. If she wants something she has to have it now. She has been earning money most of the time travelling but I still had to give her the money to get home!!
I actually sort all her accounts/money etc out for her and I’m going to continue when she gets home to ensure this debt is paid back before Christmas. But what do I do after that?
How do you teach a 20 year old that saving or contributing to a pension plan at a young age would be the best thing she ever did!

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5 Responses to Teaching your kids to be money wise??

  1. I don’t think this is a scare tactic, but if you explain to her how much your debt has piled up over the years due to interest charges and stuff, maybe she’ll listen. and tell her money spent on paying off credit cards can be used towards building up retirement; and she has lots of time being young. time meaning money, because of the power of the compound interest.

  2. Olga says:

    Hmm. It’s difficult. I mean, I am an almost 20 year old too, but I don’t think that my parents taught me a lot about saving or contributing to a pension plan. My financial decisions mostly come from money magazines, internet sites or books. Maybe the fact that my parents never overspent and preferred to save helped a lot, but I personally think that how we act is not determined by our parents’ habits or their advice to us.

    Try to talk with her about money. Tell her honestly how you decided to stop overspending and pay out debt. Maybe it will help her to make the same decision. Could you try to make her interested in personal finance? I’m sure that reading pf books and sites had a large impact on my financial habits.

    I really hope she will hear you.

  3. LeighAnn says:

    It is hard, especially when you see your kids going down the same path.

    You will do good with showing her, I’m sure!

  4. I guess talking to her about your experience and how hard it is to pay it all back would be really helpful, I wish someone had done that with me before I went to Uni. I know when I was in my early 20′s I thought credit cards were great and thoroughly enjoyed myself in my year out and at uni, going out and spending money on what I wanted, but now at 27 I’m kicking myself for being so stupid with money. I worked in a bank before going to uni and I could have saved a fortune, I saved a pitiful £800!! Had i been more careful in my year out I could have still had a fab time at uni but I also wouldnt have needed an overdraft or credit card and ended up in debt after graduation, there was simply no need for it. Plus I would have learnt a lot about the value of money if I had been encouraged to save (I know the value of it now, it just took me longer to get there!) My mum tried to instill in me that credit cards weren’t the answer but she also allowed me to learn for myself and I really value that. I had friends whose parents paid for everything and I dont necessarily think that’s a bad thing but I also dont think it helps them learn about managing their own money (the friends I have who got everything taken care of financially are now in a worse financial situation than me!). I think it’s a case of helping as much as you can and guiding as much as you can but also letting them make their own mistakes and learning from them…so long as they arent really big mistakes that is! I think just encouraging healthy money management is a good way to get started and encouraging her to see the value of being OUT of debt rather than IN debt.

  5. Thanks for all your replies. I’ve seen a book called ‘the savvy girls guide to money’ which i’m going to get her. I think its aimed at 25 -35 year old who like nice things. It tries to teach you that you can have new shoes and a pension plan. I don’t think all my being frugal books will work!

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