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When is the right time to start talking to kids about finances? (Sorry, kind of long.)

The topic of my daughter's sixth birthday came up last night at dinner. My boyfriend and I didn't argue, we just sort of had a different perspective on the subject, and it got me thinking. She wants two big things, and money being what it is, she's probably only going to get one of them.

First, she wants a party with her friends. Cake, games, streamers, the whole thing. Actually, she was worried she wouldn't turn six if she didn't have it. We assured her she would turn six, no matter what, party or not. It's funny what kids think. She's also seen Princess Twilight Sparkle and Princess Somebody-Or-Other-Else from MLP on Tv at Build-a-Bear Workshop, and she really wants to go make those for her birthday. We can't afford to do both.

So after the kid went to bed, I said we should have her choose which to do, a party or Build-a-Bear. It made perfect sense to me. When I was growing up, my dad worked construction. Some years were rough; some years were better. Financial matters were always out on the table. Not down to the penny, of course, but the big picture stuff. My boyfriend, on the other hand, never knew his parents struggled till he grew up and went through his parents' things after he sorted their junk when he moved them into assisted living and foun ledgers and budgets. It was a big shock for him. So his thought is having our daughter choose between a party and Build-a-Bear would put too much pressure on her at her age. He thinks we should just decide for her; give her a party, save up and do Build-a-Bear at the end of the year as a surprise when she finishes kindergarten.

I'm not opposed to his solution. It's a good compromise, and we may end up doing it. But as to the bigger picture, I'm wondering if talking to kids about finances at five or six years old, and letting them help make tough choices, is such a bad thing, really. We did it as kids. I vividly remember counting coins with our dad one year because we wanted to get our mom a can of Pepsi for Christmas and put a big red bow on top, and we were three cents short for the huge red bow we wanted. Some lady in line behind us gave us three pennies, and you would have thought she'd handed us a winning lottery ticket with how happy we were. Maybe I'm rambling, but I'm interested in your thoughts.


Asked by Ballad at 12:55 PM on Dec. 10, 2013 in General Parenting

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Answers (17)
  • I agree with you, but I grew up really poor and was always aware of it, as in I got probably too excited when I moved out at age 18 and bought my first pair of shoes that weren't my only pair(meaning first time I had ever had a second pair of shoes new). lol

    I also don't hide financial issues from my son, there have been many times when we told him, ok we can't do A but perhaps we could do B or we could save up for A etc.

    He is also 6. I think it is healthy for them, you aren't asking them to figure out how to pay for food, just choose between two options that they had wanted.

    Answer by tntmom1027 at 1:07 PM on Dec. 10, 2013

  • I don't think kids need to necessarily know exactly how bad your money situation is, but to know that you can't afford everything they want is not a bad thing. Kids should know that in life, we don't always get what we want, and sometimes we have to sacrifice one thing for another (the party for the bear, or vice versa), or that we have to save up to get something we really want, or put it off because the mortgage needs to be paid or the electric bill is due. They don't need to know you're scraping couch cushions looking for pennies to pay that electric bill.

    As to the specific issue of you deciding or letting her decide - that's a toughie. She wants both, but she might want one more than the other and if you choose the wrong one, she may still be disappointed. But letting her choose takes some of the surprise and magic out of it. That's a really tough one.

    Answer by wendythewriter at 1:05 PM on Dec. 10, 2013

  • I think having her choose is a good idea as far as her starting to learn you can't have everything you want and sometimes you have to prioritize. However I don't think you have to tell her "because we can't afford it". Kids shouldn't have to deal with grown up issues or worries. My parents are quite well off but we still had limits on how much we spent on things - not because my parents couldn't afford it but simply within confines of what they thought was reasonable.

    Answer by missanc at 1:24 PM on Dec. 10, 2013

  • A party does not have to cost a lot of money.... Just cake and ice cream for here and like six friends. You can probably do both if you try. The birthday party years don't last long... You only have a small window of opportunity there!

    Answer by Crafty26 at 1:03 PM on Dec. 10, 2013

  • How about a Party at Build A Bear? I think it's $10 or $12 a kid with a 6 kid minimum. My Son was invited to one & loved it. Then we all went to the food court & the Parents had a huge table set up with balloons & cupcakes. Done!

    Answer by ILovemyPaulie at 1:39 PM on Dec. 10, 2013

  • Just tell her scalled back party & the gift. Kids don't really care if there is an "entertainer" They just want to get together and play. When my DD turned six I had all kinds of crafts to do at her party... they did one thing and asked if they could go play in her room. All 7 girls dragged her barbie stuff out to the living room and had a ball for 2 hours. Who knew!! Just grab a few trinkets for prizes at the dollar store each week... say 5 bucks a week. Then you will have goodie bags all set by then. Watch for clearance at the end of this month.

    But it never hurts to have a running dialog about finances. My kids know we have the money for the things we NEED (security) but we may not have the money for everything they want. She should have realistic expectations going forward. Just don't make her feel like her basic needs won't be met in that dialog.

    Answer by Crafty26 at 1:40 PM on Dec. 10, 2013

  • LOL Crafty, this is how every question is asked in my house, "Before you say we can't afford it??????
    They used to tell me write a check then you don't need any money, I agreed scaled down party, $10 a week from now until then should be able to produce a wonderful party.

    Answer by 2kids2dogs2cats at 1:43 PM on Dec. 10, 2013

  • My daughter is seven. We do not worry her with our finances. It is for me to know and for her to know she is secure, loved, and her needs are taken care of. I tell her that Santa brings her one gift she is thinking of. To think very carefully and make her wish wisely. We do one gift from Santa and one from us as her parents. In order to teach finances I have an allowance and three jars. One jar is marked share. This is for her to donate to her charity of choice. Our favorite currently is the Ronald McDonald House. The next is spend. If she wants that candy bar or dollar toy she can go for it. The other jar is save. She has to put one dollar in each jar and has two left over to decide where her money will go. It teaches her how to handle her money and make good choices, or not. The lessons are her's.

    Answer by Anonymous at 3:51 PM on Dec. 10, 2013

  • Okay if you make cupcakes and buy them, lets say Cake and ice cream $20, have her friends over for an hour or two for the party, you could go to the dollar store and buy trinkets, say 6 kids come to the party that is $30, can't you take her to build a bear by herself and get the smallest one? You didn't say how much is in your budget, but I think for roughly $60 you could to both, or use the build a bear as a Christmas treat?

    Answer by 2kids2dogs2cats at 1:03 PM on Dec. 10, 2013

  • I would do a party, and not hire a guy to come in and do games. You don't need to pay for entertainment for 6 year olds. In fact, you could give her a cupcake party, not order a cake. Bake cupcakes in different girly colors, Put out decorations and let each child decorate them. This would be entertainment and the cake. Games for 6 year olds are pretty easy.

    You could do a simple tea party for her with juice or lemonade instead of tea, peanut butter and jelly or other sandwiches cut out with cookie cutters, and mini cupcakes for the children to decorate.

    There are so many cute parties that can be done without spending a lot of money.

    Answer by ohwrite at 1:34 PM on Dec. 10, 2013