4 Questions your kids may ask you regarding personal finance management

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By: tiarajoseph11
on 13th Oct,2015

Your kids may ask you these questions about your finances, prepare yourself to answer them.
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Your kids may ask you few questions which you may find very difficult to answer. The situation becomes worse when they want to know any finance or money related question. So, you must provide them good financial knowledge with logical answers. The answer should be practical and wise. Here are 4 common questions which your kids may ask you and how you can answer them perfectly:

1. "How much are you getting monthly?"

As your children grow older, they start learning about the ways to make money. They’ll learn that each person earns differently. His/her income varies from each other and it depends totally on the characteristics of the job. They’ll be clearly ask about how we fit into our designation.

You will have to be patient while handling their queries. It's up to you, how much you’ll be transparent with them. Maybe you give them a false answer or decide to remain totally silent about it. That is wrong. You shouldn’t avoid answering them. You should try to avoid answers like “none of your business” or “it's not important for you”. It’s better not to reveal your financial details at first place. Your children should be mentally ready to handle such kind of information. If they really want to know about it, you should prepare them by giving important financial lessons. Inform them about your income when they’re around 5 or 6 years old and gradually reveal your details as they grow up.

Ask them why they need that information. It could help you have an idea about their thought process. You must explain them about your basic income, your budget, and your expenses. Use your discussion to teach your kids about personal finance.

2. "We are not rich – we are poor, isn't it?"

There are various reasons which can trigger this question. Your kids are growing up with lots of other children, in the school, playground and also in the neighborhood. They can easily notice if any other child is having more toys or other kids are coming to school in a luxurious car, but they aren’t.

In this scenario, you can do one thing. Tell your kids a big “No”. Tell them that you’re neither poor nor rich. Make them believe in you. They should feel that they’re safe and secure with enough money to buy anything they need. Your kids have a deep concern about your family and its security, so make them understand that your family is protected and they’ll always be taken care of.

Professional would agree that you must understand what your child feels like. Most of them would agree that you should present your answer in such a way that the answer would reflect about your high quality of living in all the possible ways. It’s also a perfect time for you to clear the misconception about being a poor. Tell them that money wouldn’t make them any better from others. Rather, they should at first try to be good human beings. Even if you belong to a wealthy family, teach your kids to respect the money and not to spend it unwisely.

3. "Can I buy that thing?"

It is a very common issue if your kids aren’t aware of the basic concept of money and its value. It’ll be tough for you to make them understand why certain things are inaccessible to them. If they ask you this question, it may be a golden chance for you to clarify them about a certain aspect of saving and budgeting. You can discuss with them all your own saving plans and budgeting strategies. Who knows, maybe you can get a unique money-saving idea from them also.

Give them an answer which can motivate them to save money. You can implement a good saving habit like collecting coins in a cookie jar or something. While explaining the answer, you should be mindful of your words. Talking about money matter is something which can make a deep impact on your kids' minds.

You can tell them not to think much about money matters. If the commodity they want is costly as well as unnecessary, make them understand why it shouldn't be purchased immediately. Maybe there's something which is more important and they might want to spend money on it.

4. "If you don't have any money, what will happen?"

If unfortunately you lose your employment and your kids come to know that truth, there is a chance that they might ask you this critical question. It’s very tough to answer that because, sometimes, you'll have no idea what to say. You can't ensure your job's stability and if you do lose your job, it's for sure that your financial status will be changed.

If you lose your job, it's better to inform them about the situation. You can try to make things a bit normal. Talk to them regarding savings, government aids, and unemployment insurance. Explain to them that the situation will be resolved as soon as possible and you’ll have enough food and shelter to live.

Initially, these questions might seem odd to you. But just think, being a child, it’s very natural to look for safety and comfort which they’re familiar with, since childhood. So, understand why your kids are asking such questions so that you can prepare yourself for the answers. Ultimately, your answer should make them stronger and wise. As they grow older, they must have an intellect to make smart financial decisions.

Read on: Are you sure you aren’t teaching bad financial habits to your kids?

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