Like many other people, however, I don’t think it’s appropriate to go over all the income and line items in a budget with children. I think most children would get overwhelmed and I also think most would share personal financial decisions with other people. Having lived in a family that didn’t talk about money I understand where Trent is coming from in terms of wanting to teach his children. However, I think there’s a time and place for doing that. Sitting your 7 yr old down at the table to review finances is treating your child like he/she is an equal sends some troublesome messages.

I for one know I don’t want the whole neighborhood knowing how much we make. Nor do I want my kids to worry about bills or thinking that paying them is their responsibility. As the parents it is our responsibility to manage the household and this means paying the bills, doing the financial planning and teaching our kids about the value of work and money. This doesn’t have to be done in the same sitting. I think the best way to teach our kids the value of work and money is to be working together as parents in harmony (not fighting about money) and making responsible choices. Even if you don’t break it down kids know when their parents are doing this. They pick up on so much. I think that we can find ways throughout the day in which we can also find “teachable” moments to explain financial decisions to our kids.

I do think that once your kids become adults it is important to share financial details with them. At this point children can handle it and it also opens up the dialog around what a parents’ financial needs are as well as what kind of expectations the parent has from their children (do mom and dad have enough for their own retirement, etc.)

The kids don’t need to be in the boardroom though.

2 and 3. From what I’ve read in other places, Europeans generally don’t keep their salaries as private either. (I do mean income, too- no one anywhere gives away their bank account information!) I am open and interested in people with firsthand knowledge sharing their experiences.

4 and 5. Going up as a United States citizen, I certainly didn’t think about income privacy as a social norm; I didn’t think about it at all: it was just something that everyone did. I was so shocked when that guy asked about my mother’s income, but then when I thought about it I was shocked at how shocked I was. I hadn’t realized that the fact that salaries should be private was a belief at all until I was challenged in this way. More generally, many social beliefs are so ingrained in people that they don’t realize that they may not be true or that they may not represent the best way.

I’m not convinced that hiding salary information is a good social norm for a society. It privileges bosses over workers, because owners have essential information that workers don’t when workers try to negotiate salary. Also, I think it encourages people to feel ashamed if they have a low salary, so they try to buy stuff to appear rich.

But I’m not try to change society here. I’ll keep my mouth shut around random people. But the fact that people feel so strongly about income privacy that they won’t tell their loved ones about their financial situation tells me that something is off. I would encourage those people to examine their beliefs about money and privacy and see if those make sense in the context of family and the people they trust most.

1. Provincial values are inferior to universal values.
2. Most cultures frown on financial privacy.
3. Taiwan is like most of the world and America is not.
4. Those who favor financial privacy haven’t thought about it.
5. Those who favor financial privacy believe it is a universal value.

I am not sure how many of these are true.

I agree with the need to teach your children finances. However, I do not think they need to be burdened with the specifics of an adult budget. It cannot be a good thing to have your children stressing about adult issues. My husband grew up in such a family and now he has a very difficult time when it comes to money issues. He is constantly worried that he will become like his parents, even though we are FAR from being anything like them.

Like several others, I also disagree with telling your children everything, at least for my own family.

We make a lot of money. By the time we have kids old enough to ask about it, I can only imagine it will be more. We also use our money much differently from most folks we know – saving and giving are lacking in a lot of people’s lives. So it doesn’t look like we make nearly what we do.

I think it’s hard for kids to keep quiet about that kind of stuff. I would hate for someone to feel bad or resentful, or whatever other negative thing might happen, if they got this information they really didn’t need to know. I can envision this happening with certain members of our families or some of our friends.

I also think it’s hard for kids to even conceive of the kinds of money grown-ups talk about. For example, the reality of those college loans was not at all clear to me until well after college. I think it may make them even more likely to talk about confusing sums of money as they try to sort it out. As others have mentioned, other kids may say inappropriate things and I don’t want ours hitting back with any information we give them. They will be comfortable and well taken care of, and that is enough for them to know.

I grew up always worried about my parents finances. Finding a way to eliminate that for our kids and teach them to responsible will certainly be a balancing act. I think I’ll be able to let them in on budgeting and planning and being frugal, as well as our values about money, without telling all. For us, that will be a better solution.

Jennifer

I think that for elementary school age you concentrate on the child’s finances (allowance), as they are totally self centered anyway. Introduce some specific things like saving for a vacation and the budgeting of how much will be spent on various expenses there.

In junior high introduce things like the food budget for the family, wise shopping, cooking skills, and some investing concepts such as cds or mutual funds. They might get excited about helping with the research for major large purchases such as cars.

In high school is where you get down to more specifics such as your own situation of income and budgeting. In other words, when they are old enough to have some discretion. I found that having them balance my checkbook and help pay the bills was a real eye opener for them. They figured out pretty fast that some of their friends had nice new stuff but had trouble paying the bills. We had much less stuff and they knew we could last for months if jobs were lost, which eventually did happen. They also knew they could go to college and acted accordingly in their studies.

Several of the posters seem concerned about their children’s sense of security and I can attest to this first hand. Because of his dad’s death, my son felt very scared, and I have spent the better part of the last 8 years trying to convince him that his basic security is not at stake.

Where does that leave us? Well, as parents it is our responsibility to teach our children life skills but I think it is important to make sure they have the maturity level to handle the lesson. In our case, I have found that now that my son has his first job, he is much more receptive to learning about the value of the dollar…he sees just how many it takes to fill his gas tank these days!

Again, thanks for the post and your willingness to start conversations about things that most people avoid like the plague!

My mom and dad were very smart with their money, bu they were actvely secretive about it as well. So while they would issue platitudes like “don’t be a spendthrift,” they taught me no specific money-management skills, and did not even model their own skills to me. My mom would pay bills in her bedroom with the *door locked!*

I actually think it was because my parents disagreed about handling money; my dad is a saver, my mom a spender. Dad simply did not *let* my (home-maker) mom make any big finanical decisions, and my mom stuck to the budget he set her. So they are in good shape now. But it was a poor environment for learning money management skills. My sibliings and I all took about 15 – 20 years of adulthood to learn them on our own.

However, I’m on the side of those saying that Mom and Dad should be mature enough to hammer out the details of income vs. expenses between themselves.

Why? I grew up knowing debt was an issue between my Mom and Dad.

When I learned as an adult how much that debt was, I was terrified the credit card companies would come calling once my parent who racked up the debt died. I’ll freely admit that I’m an anxious person, but the figure would make anyone anxious. I was so relieved when I was told I would not be responsible for any debts my parent incurred during their life.

On the other hand, if Mom or Dad loses their job or gets sick, it’s not hard for their children to figure out there will be less income. As a result, most children will feel that anxiety anyway.