One moment made a woman realise she was teaching her kids unintentional money lessons every day

Children follow the footsteps of their parents and role models — especially when it comes to managing money.

“Our children are watching how we spend, save, invest, and give money,” writes Kimberly Palmer in her book, “Smart Mum, Rich Mum.”

There was one instance in particular that made her think about the money lessons her children were learning when she wasn’t even paying attention.

She writes:

As two-year-olds, my kids started pretending to go to the grocery store by carrying little tote bags around our house, picking up toys, and putting them inside the bags.

When it came time to pay for the items at the pretend cash register, they would slap their pretend credit cards into my hands. “There you go!” they called. They have pretty much only seen me and their dad pay for anything with plastic or online.

Palmer reflected that her children were only echoing the behaviour they’d seen in their parents — and that behaviour didn’t include dollars. “It made us think twice, so now we pull out cash more often instead of our credit cards so our kids can grasp the concept that money is real,” Palmer writes.

She also talked to Judith Ward, a senior financial planner at T. Rowe Price Investment Services, and found ways to make it easier for both her kids to watch some of her daily money decisions.

She writes:

When my daughter needed a gymnastics leotard, we scrolled through the different options online together and compared prices. At the grocery store, I showed her how to look at the per unit price for making apples-to-apples price comparisons when milk cartons came in different sizes, as I remembered my dad teaching me. At the school book fair, I told her that her budget was $20, and when she reached it, she understood that she couldn’t get another book, even though she wanted one.

Palmer also talks about incorporating conversations about money and actively distinguishing good money behaviour in everyday activities to help your children do the same. “In all things, from eating to getting dressed to interacting with our partners, we are their models,” writes Palmer. “For better or worse, they are basing their own budding identities on what they see us do.”

And as important as it is to demonstrate good money habits and attitudes in front of your children, it’s also important to keep the topic of money open and early on in their lives, including letting them make healthy mistakes to really learn about money.

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