From what parents tell me, sometimes it’s just plain challenging to talk to your children and teens about money. Heck, sometimes it’s even hard to talk to your adult children about money. We understand.

For whatever reason, as parents, sometimes the words just don’t come naturally. Add to that our own insecurities around money and wealth and well, sometimes it’s just messy.

In my book, The Ultimate Allowance, I give you pointers on how to talk to your children when they find themselves in different, and often difficult, financial situations:

• When they make a great choice with their money.
• When they make a poor choice (pun intended) with their money.
• When they ask you to pay for something when they have their own money.
• When they rebel or complain about having to be financially responsible.
• When they run out of money (as they invariably will).

So, for your reading pleasure today, I’m giving you the section in The Ultimate Allowance entitled, What To Say When.

What To Say When…

They make a great choice…

This is the best time of all! Sarah Singer-Nourie, in the book she coauthored on accelerated learning called Quantum Teaching, likes to say, “If it’s worth learning, it’s worth celebrating.”

A pat on the back and a rousing, “Great job!” is the first place to start when it comes to making children feel great about themselves and their choices. They learn to associate great money choices with positive reactions from you and others, but best of all, they associate these great choices with positive feelings within themselves.

In addition to celebrating a really big win with them when they make a great choice, you might reward your child with the following:

• A special night out for dinner, a movie, ice cream, concert, or some other activity they enjoy.

• A bonus to put into their FREEDOM Jar: cash, shares of stock in their name, etc.

• Something they love, like a new book, art supplies, etc.

A couple of points: I’d refrain from celebrating with the purchase of piddlyjunk because the message there is, “Spend money when you feel good,” and that’s not the message you want them to take into adulthood. I’d also suggest that they invite a friend to help them celebrate, thereby setting a great example for the friend as well.

Again, save the special celebrating for times when they’ve had a really great success or win, not every time, or they’ll learn to save and invest because they are being externally rewarded. We want them to be motivated internally for life so they’ll manage their money wisely just because they should and they learned it’s how you become financially secure.

They make a poor choice (i.e., a mistake)…

I truly believe that, for the most part, kids don’t get up in the morning and ask themselves, “I wonder how I can mess up my life (or my parent’s life) today?” Mistakes are just their way (and our way) of learning about the world. Kids generally want to do their best, just like us. Remember, we are generally all doing our best with the information we have at the time.

When kids do make mistakes, we have a choice in how we respond. Some responses tend to make kids defensive—causing them to hold back or lie to you—while other responses help create kids who easily and happily learn from their mistakes.

Kids who fear punishment, or the loss of love, in response to their mistakes, learn to hide their mistakes. These children live in two different places: one where they have the love and support of their parents, and another where they feel that if their mistakes were discovered, they would be undeserving of that love. It’s hard for these kids to fully accept their parents’ love and support even when it is expressed. It’s also difficult for these kids to set high standards for themselves, because they tend to be afraid of failing.

In life, there really are no failures, only learning opportunities, so please be careful with your words. One of my favorite sayings is that the only real failure in life is the failure to participate. I love this philosophy. What if kids were encouraged to try all sorts of different things and make mistakes in order to learn? What if we intentionally set them up for success every day? What a difference that would make in our society!

From my experience working with adults, many of them are so afraid of failing that they often won’t even try new things; they don’t feel good enough or worthy of success because of the way they were treated as kids.

Here are some suggestions if you are committed to raising kids who can learn from their mistakes, and you’re not afraid of making a few of your own:

• Accept the idea that your kids are doing their best, and embrace the idea that they’ll learn faster from their mistakes if they are in an environment that accepts mistakes. This means that you must set the example by not getting upset when you, yourself, make a poor choice. Let your children hear you say out loud, “Wow, that decision/choice didn’t lead me in the direction I wanted to go. I wonder what I can learn from this?”

• If you’re having difficulty (frustration or impatience) with your child’s mistakes, understand that this may be a reflection of your difficulty in dealing with your own mistakes. Be aware of this connection and deal with your own issues first. Your frustration may also have to do with your ‘expectations’ of your child’s behavior. I heard a wonderful saying once, ”Expectations are resentments under construction.” I think that says it all.

Remember that our children aren’t in this world to do as WE please. They are here to grow up and be their own unique person.

• Learn to recognize the negative shaming messages that we can easily give to our kids without realizing it. These messages can do a lot of damage and make them feel unworthy. Here’s a few of them:

“You should be ashamed of yourself.”

“How could you have done that?”

“You don’t listen to me!”

“That was a dumb question.”

“What were you thinking?”

“How you could be so stupid?”

“You can do better than that!”

“What’s the matter with you?”

“Why can’t you be like your sister or brother?”

• Continually provide your kids with learning experiences, and at the same time, structure their environment so they can’t make too many mistakes. For example, consider providing their allowance once a week if they have been getting it once a month, rather than giving them a whole months’ worth of money to deal with at once if they seem to be struggling.

• Again, provide a great role model for your children by the way you react when you make your own mistakes. Do you get defensive and stretch the truth, or do you “own” the mistake and learn something from it? Create an environment at home that’s based on learning from mistakes.

There are plenty of daily opportunities to show our kids the patience, acceptance and discipline it takes to allow us all to learn from our mistakes. Give your kids the room they need and deserve so that they can learn organically; in other words, let them learn by doing and experiencing. Sometimes, it’s not just the choices you make, but what you make of the choices.

Some things you can say to your child are:

“It’s perfectly OK to make a poor choice. It’s how I have learned some of my biggest lessons in life. I remember one time when I __________________ (fill in the blank . . . give him a personal example to relate to).”

Then ask, “So, what did you learn from this choice?”

Don’t make what they chose or did wrong (notice the word ‘poor’ in the sentence above) and don’t give them more lesson than they are ready for. One good lesson learned per mistake is about all kids can handle. (It’s about all adults can handle, too.)

Another option:

“Hey, I make mistakes myself. Everyone I know makes mistakes. Big deal. Fact is, no one who is great ever got great without making a lot of mistakes. It’s how we learn.”

“Would you like to talk about some other options you might be able to choose next time?”

And yet another:

“I know how you feel. I remember when I used to do ____________________ when I was your age. Boy, what a bummer. I can totally relate.”

Really get on their level and help them feel like you really do relate to their experience (and mean it). Let them know it’s OK, no one is perfect, and tell them there’s a reason the front windshield in a car is bigger than the rear view mirror: we need to spend most of our time looking forward, not backward. A couple of fun sayings to instill are:

“Live and learn,” and, “Correct and continue.”

A note about the power of words: It is my personal belief that words are powerful. I also believe they can mean nothing and everything, all at the same time; it just depends on what you make them mean. Because we do tend to make them mean more than they usually mean, do your best to refrain from using the word ‘mistake.’ Frame your children’s actions and behaviors as a choice that didn’t lead toward a desired goal or use the terms supportive and nonsupportive.

Some of this information was found at: www.markbrandenburg.com

They ask you to pay for something…

This situation is bound to happen. Remember Conclusion Number Two: children would rather spend your money than theirs. If they think there’s a good chance that you’ll buy something for them that they haven’t saved for, they are liable to ask you to do it over and over and over again.

While there’s nothing wrong with occasionally buying something extra for your child, just remember your intention for this program: preparing your child for financial self-reliance. If you continually buy things for your children, they are not learning how to be self-reliant.

When you DO decide to buy something for your child:

1) Don’t do it when they are begging; and,

2) Work out a cooperative plan with your child. For instance, you could agree to pay for a portion of the purchase and they save up for the rest, or they agree on some other type of exchange for helping them purchase something they want.

NEVER, I repeat NEVER agree to loan your child an advance on their allowance, unless, of course, you charge them interest!

Let there be lessons in it all. If you loan them money without charging them interest, you are teaching them how to use credit cards without the card. If you want to go one step further, have them sign a promissory note, as well. My Mom always did this with me and you can imagine how official it always felt. There was NO way I would have ever missed a payment or not paid her back. And, I might add, that she never hesitated loaning me money!

I also think it’s fine to buy kids something special if you’re away on a trip or you just see something that you know they would love. We all love surprises.

They rebel or complain…

As I’ve said, occasionally there is a child, typically a Money Monk or an Avoider in the making, who just doesn’t want to deal with the whole issue of money. It’s usually a matter of not wanting the responsibility that comes along with it or their being so busy or focused elsewhere that they don’t want to deal with it. If this is the case with your child, there are some things you can do.

First, do what you can to uncover the root of the problem. Even children have the beginnings of deep-seated beliefs about money, and although most children crave independence, many of them are scared to death of the idea of taking care of themselves. (This is also one of the reasons adult children move back in with their parents, or never leave in the first place.)

A couple of questions to consider:

1) Is your child responsible for too many things in his life already?

2) Is he involved in too many activities and can’t deal with the idea of one more thing to handle?

3) Has she watched you or someone else express negative emotions or anger in regard to the responsibilities around money and financial matters?

The answers to these questions may give you some insights into your child’s unwillingness or inability to embrace the idea of taking care of his own money needs.

When approaching a child who just flat out doesn’t want to deal with money, some well thought out questions leading to a nonemotional conversation (on your side) might just tip the scales in your favor. Ask him what money means to him. Ask him what his life would be without money. Ask him who is going to handle the money when he gets older, and other questions like these. If you still don’t get anywhere with your child, elicit the help of one of your child’s adult friends; an uncle, aunt, friend or teacher. You never know who may have access to the inner workings of your child’s mind and heart.

Again, do your best to uncover the why. Then you’ll know how to help him through the challenge and gently ease him into a life of financial responsibility. Keep in mind this isn’t a life or death issue (at this point) so take your time and gradually you’ll find the answers. The most important thing to remember is to create a safe place where the child can talk and express his thoughts and feelings about money and taking care of his own financial needs.

They run out of money…

It’s bound to happen; children make poor choices just like we do. A great way to handle this situation is to ask questions:

1) How do you feel about choosing to spend your money that way?

2) How does it feel to not have enough money left over to pay for the things you need to pay for?

3) What are the consequences of this choice?

4) Didn’t you make an agreement to budget your money so you could pay for the things we agreed you’d pay for?

5) What do you think I should do to help you?

6) Is there something that influenced the decision that led to this situation?

7) How can I support you in the future so this doesn’t happen again?

8) What did you learn from this choice?

9) Would you like to make a new agreement?

10) So, what are you going to do now?

And so forth. Unless it’s an emergency, my advice is: don’t bail him out. You must let him experience the consequences of making a poor financial choice or the lesson will be lost. One of the belief systems you don’t want to foster is that someone is always going to be there to rescue him. This is a common belief that parents instill in their children by the responses they make when their children make poor financial choices. It does not serve your children to rescue them. Our number one principle in all of our programs is:

Please don’t chastise or criticize him either. He knows he made a poor choice (the words poor choice hold less judgment than bad choice). As I keep saying, we all make mistakes, and we stress in our all of our camps and programs that financial freedom is your responsibility and it’s all simply a matter of making choices. These times are the perfect times for your kids to start really paying attention to all of the financial choices they make, big and small.

If you’re lucky, the idea of life being the sum of their choices will transfer to other areas of their lives; relationships, attitudes, school, fitness, health and more. This is how we create responsible adults instead of victims.

So, there you have it. Ways to encourage and support your child along their own path to financial responsibility and wisdom. Take every opportunity you can to encourage learning through their experiences and yours. I promise this WILL pay big rewards later.

Just something else to think about.