Larry MacDonald asked me a few questions for an article he is working on, and it caused me to think a bit more about a subject that it is essential as parents to talk to our kids about. What are the taboo subjects with kids in most families? As a child growing up, my parents never brought this subject up, and I must also admit that most of what I learned about it initially I learned “on the street.”
What is this taboo subject that so few of us talk to our kids about (and heaven forbid ever want to educate them about)? Debt is the new taboo subject, not sex. My parents did talk about Money, but mostly in platitudes about the importance of saving and knowing how much Money you earn and working hard (the Anglo-Catholic work ethic).
The subject of DEBT was taboo, and I suspect it is in many houses because parents feel squeamish talking to their kids about this important topic. Admitting to your kids that you carry Debt seems almost to be like talking about whether you did drugs as a kid or when you lost your virginity (nope haven’t talked about either subject with my kids either).
As a youngster, the first time I heard about DEBT and borrowing was from a school chum, who said his Dad had got some money from HFC (Household Finance), and at the end of the month, he had to pay back MORE Money than what he had been loaned. This concept seemed completely foreign and weird to me, and I believe I may have brought the subject up with my parents, and they may have dismissed it with a, “Well, never deal with a company like that….”.
There was an opportunity to teach a young mind about Debt and borrowing, but an opportunity was missed in this instance.
You don’t have to go into gross details about your Debt to your kids, but explaining to them what Debt you have, and better still WHY you have that Debt, may be an essential lesson to teach your children.
An example would be explaining your Mortgage and why you carry that Debt. Kids think you own your house (I know I did), and I didn’t figure out that my parents didn’t own the home until I was graduating high school, and there was talk of Mortgage burning parties and such. Having kids understand what a mortgage is for (and maybe what it is NOT for) helps them understand what Debt is, and the more they know Debt, the less likely they are to get themselves into a “Debt Jam.”
Too many kids I know have no idea what Debt is, or worse, don’t seem to care how it can disrupt, strain or even destroy lives and relationships. If your kid grows up with the following cause and effect model:
I ask Mum and Dad for an iPhone -> They argue about it, say that it is too
expensive -> I keep asking, and finally, they buy it for me -> They get mad
at me when I lose it or use it
What are these kids learning? Did you have to go into Debt to buy this toy? Can you afford to pay for this toy? Does your kid value this toy? (I believe in this example the answers are: Nothing, Yes, No, and No).
Teach Your Children Well
Teach your kids about Debt (aka the 800 pound Rhinoceros in the room) and encourage them to learn about it themselves. Don’t let them know about it on the streets!