We should revert to the old rules of family finance, even guru Suzie Orman agrees.
Remember, those Depression era folks? Some are still around, like my in-laws.
They considered it damn near a sin to borrow money.
Pay interest? No way.
Never had a credit card or a car loan.
It’s not likely we will get all the way back to those rules ofbut look how far the pendulum has swung.
What will you value you more, something you worked for months to save so you could buy it, or, the same thing, if someone gave it to you?
The question answers itself, so why do so many parents buy cars for their kids?
Have not done this one in our house, and I have never worried about my daughter’s car.
And she takes great care of it.
Don’t give your kid a car to feel good about yourself.
Spend the money on therapy instead.
Gifts are not a substitute for time.
Kids know what is important to us, to anyone.
It is what you spend your time on.
Here they are:
1. Don’t borrow money to buy stuff for your kids.
2. Don’t buy them a car.
3. Don’t pay them an allowance for doing nothing, tie it to household chores.
4. NO STUDENT LOANS.
5. Encourage kids to find ways to save money on household expenses, and split the savings with them.
6. Show them everything costs money, water, electricity, heat, air conditioning, insurance, taxes.
This can be done in age appropriate ways, and do NOT share any of this information in a way that will scare the kids, e.g. “How the hell are we gonna pay the bills this month!”
7. Practice what you preach. Don’t borrow money to buy stuff for yourself.
Hey, do as I say, not as I have done all the time.
The main thing to know about kids: they are people too.
They pay more attention to what we do than what we say.