<p>Heck yes! D (20 college junior) has known the situation since she was 13 and asked, “Mommy, what do you make?” She thought the number sounded huge…UNTIL I broke down all of our expenses for her. Then she said something to the effect of “you don’t earn a lot”.</p>
<p>Side note: when I lost my job Dec 1st, she was my first call. She just has to know that my income has stopped (save for unemployment insurance).</p>
<p>Knowing the details of our finances isn’t likely to take away our kids’ motivation - if anything, I would think it would be likely TO motivate them! :)</p>
<p>We have always been upfront about what we can and cannot afford, as well as being honest about what we will and will not pay for things (this does not necessarily coincide with what we “can” pay). We did not tell our kids what we made or how much we had invested. There was no point of reference for understanding, so why give the details?</p>
<p>Now that D is almost 1/2’way through college, I am more open about the details of salary & investments. She is beginning to think about housing costs, insurance costs, etc. By sharing our details with her, I feel that she will be better able to understand how a particular salary will allow her to live. As she plans her future - job, grad or law school, area of the country, etc - she has some idea of how it all fits together.</p>
<p>I do think that helping kids understand that there are choices to be made in life is more important than actual salary/investment details - this kind of info should be a part of their life from the earliest stages. We have chosen not to spend more than we make. We have raised our kids to understand that you can’t have something just because you want it. As our kids begin life on their own, I am confident that they will be able to make wise choices … and not have to come running home because they can’t afford to live on their own. At least, my fingers are crossed in hopes that I am right …</p>
<p>Ok, who remembers the Cosby show from way back when Theo was saying he didn’t want to go to college and would be happy to make $X. Cliff brings out a wad of money and they start dividing it out for an apt, a car, clothes, etc. Theo says something to the effect “see there’s plenty”. His dad responds “you didn’t eat yet!”</p>
<p>^ I do. It’s very funny. Both of mine were not of the right age to appreciate it when it first came out. I am sure they do now.</p>
<p>I remember that Cosby… and the Reality Hotel :-)</p>
<p>My parents were extremely open and trained me carefully in finances. I was <em>shocked</em> at how ignorant my college friends were and watched them get in big financial trouble. I decided then my parents did a great job raising me and I’ve tried to follow that same openness and training with our children.</p>
<p>I have shared “too much” information about our finances with our kids, according to them. Some of the things I’ve done:
*taken them to the car dealer to negotiate buying a new car
*taken them to the annual visit to the accountant (my son ended the appointment by asking the accountant if she would please take him on as a client) (she has a limited clientele)
*taken them to the bank when dealing with the aftermath of a fire at our business that had destroyed all our paper financial records
*gone over our will with them, and what to do with it “in case the plane crashes”
*taken them to look at houses for sale
*helped my daughter to negotiate an accident settlement with the insurance company…
*gone over medical bills for cancer treatment (“this is why you need catastrophic health insurance, dear”)</p>
<p>“Knowing is important if parental finances in directly affect student lives.”</p>
<p>I’d rephrase this slightly, to “Knowing is important if NOT KNOWING about parental finances ADVERSELY affects childrens’ lives.” My parents had a “Don’t ask, don’t tell” philosophy which led to significant adverse effects. C’est la vie.</p>
<p>As for communications with my own kids, they’re too young to relate. Their eyes glaze over anytime I mention something like “the rule of 72.” Maybe they’ll be more receptive in ten years.</p>
<p>Finances are like driving a car or any other thing that you teach your kids: you dole out sound bites over the years, increasing the complexity of the information as they are ready to hear it. </p>
<p>These kids will need to manage their own finances soon. Modeling behavior for them over the years is the best teaching tool. Getting them used to “big zeros, but don’t touch because you’ll need it later” concepts helps them know to save part of their paycheck, not blowing it on the latest clothes/gadgets and then come to you when their car breaks down.</p>
<p>this was a hard lesson for my son. I would not let him get a driver’s license.
I told him that I HAD to insure him even if he never drove the car. Letting him get the license would have tripled my insurance bill. Not a chance. Luckily he had friends that drove so it didn’t affect his social life in HS and he’s in college in NYC where there is no need for a car.</p>
<p>My kids were in high school when their grandmother died. They saw first hand what a hassle it was NOT knowing about the financial affairs (and not even knowing where all the accounts were held). DH and I vowed then that our kids would be kept informed of what was going on. How in the world can we expect them to help us in our golden years if we keep them totally in the dark (and YES we do expect them to help us…not monitarily…in our golden years).</p>
<p>When my daughter applied to colleges two years ago, I sat her down and showed her all of our financial statements. My sister and I had power of attorney over all of our mother’s finances during her later years (she died in 1994), and we now have power of attorney over our father’s finances. I believe that I made the best decisions possible on my mother’s behalf, and I am now carefully managing my dad’s finances so that he has a safe and secure retirement. I trust my daughter will do the same for me, when the time comes. My son is now a high school junior, and when he applies to colleges, we’ll sit down and have the same conversation.</p>
<p>Ultimately, your children will care for you when you become incapable of making financial decisions for yourself. Doesn’t it make sense to educate them now?</p>
<p>I wish I had a better understanding of my family’s finances. I’m a college senior. During high school I was curious about being an adult and planning my future and asked my parents for a ballpark of how much they made and they refused to share this info with me, I also had no idea when selecting a college- all I knew was what the colleges sent me in my financial aid packets. I know how much my family makes now but I am clueless about money and how to manage finances (my parents take care of my loans etc). I’m taking a class though on how to manage money, save for retirement etc, so hopefully I’ll be ahead of the crowd soon.</p>
<p>We have shared some of our financial info with our kids–pretty much as what they were interested in knowing at any given time. Most of us learned over time by experience as most of our parents did not share financial info or much advice with us. My friend has had her kids submit an annual budget to her & her husband that they review with each child and fund or modify & then fund. She has done this since HS & they have had a pre-loaded debit card since HS with their monthly amount deposited onto the card by the parents. The kids know what is expected to be paid out of their budget & what the parents will pay. It has caused them to learn to make choices and stopped nagging. It worked well for them. </p>
<p>We tried it on a smaller scale with our kids from time to time–when we went on trips/vacations, we would give them a lump sum for spending money. Invariably, D would spend nearly all of it & S would save nearly all of it. At this point, both are pretty good with their money (S is a college junior & D is a college sophomore). Through HS, I would give them weekly or monthly sums for food and spending money–they rarely sought additional funds.</p>
<p>In HS, both kids had to find a job (from the newspaper) & create a budget based on prices in the newspaper & real life expenses, as best they could figure it out. They found the process enlightening.</p>
<p>I do not think it makes any difference. I countinuesly stress to my D. that we really appreciate her enormous efforts to lower tuition by earning Merit Scholarships that by far exceed any other $$ that she can possibly contribute out of her pocket. In comparison, nothing else seems to be of any significance in terms of actual dollar amount and efforts. We never gave our kids any allowances or required to participate in any chores at home.</p>