We just started teaching our seven-year-old about money. He’s very eager to learn, and he seems to be grasping the basic ideas quickly. He’s young, though, and of course, he makes mistakes from time to time. Should we step in and fix things when a mistake he made means he can’t do something he wanted to do?
It’s always hard on parents when they see their children suffer because of a choice the child made. But sometimes it’s best to love them so much that you’ll let them make mistakes, and make sure they learn from them, while they’re still under your protection. Reality can be a great teacher when it comes to learning how the world works, and sometimes one sting from a bad decision when you’re young is all it takes to teach a kid a lesson that will last a lifetime.
As a parent, you’re always looking for teachable moments. First, make sure you’re giving him a chance to earn some money. That means work, no allowances. We’re talking about kid-sized, age-appropriate tasks. There’s a ton of value and self-esteem that go hand-in-hand with being paid for a job well done. Once you pay him for the work he does, then you have chances for more teachable moments about saving, spending and giving - and the importance of each.
If I were you, I wouldn’t run in and fix things. By this, I mean I wouldn’t just hand him money he didn’t earn so he can still get or do what he had in mind. But don’t fuss at him or brush it off, either. Gently explain why things didn’t work out the way he hoped. Then, talk through what he might have done differently to help make the situation better next time.
Kids are smarter and often have more understanding and comprehension skills than we give them credit for. My guess, Ethan, is you won’t need to have this kind of conversation more than once or twice!
Dave Ramsey is a seven-time No. 1 national best-selling author, personal finance expert, and host of The Dave Ramsey Show, heard by more than 16 million listeners each week. He has appeared on Good Morning America, CBS This Morning, Today Show, Fox News, CNN, Fox Business, and many more. Since 1992, Dave has helped people regain control of their money, build wealth and enhance their lives. He also serves as CEO for Ramsey Solutions.