How do we relate to money? How do we raise our children to relate to money? Often we don’t think about these questions seriously. Or if we do, it’s a hard subject to figure out in a world, as Dr David Pelkowitz (Professor of Psychology and Education at Yeshiva University, NY) pointed out at the beginning of his talk on children and wealth, we don’t talk about money. It’s a taboo discussion in our society. It’s more acceptable to talk about sex (in some societies) than it is to discuss your bank balance. And, as he quoted, child psychologist Bruno Bettelheim, ‘What can’t be talked about cannot be laid to rest.’

 So I thought I’d outline his talk that I went to last week. He raised some really interesting points that are helpful on our never ending journey of parenting. The outline below is scattered with many different points. I haven’t added my own commentary. I’ll leave that to you.

 Examine Your Attitudes Towards Money

Here are a list of questions he said all parents should ask themselves when it comes to money. This exercise helps to make your unconscious beliefs conscious.

  1. What was the attitude of each of your parents towards money and how did it affect you?
  2. What was your personal relationship with money when growing up?
  3. What did you learn about money from others around you?
  4. What is your attitude to money now?
  5. What attitude do you want for your children to have?
  • Money is a stand in for power, security, achievement and love. Ultimately you need to untangle these characteristics. 
  • Imagine that you’re a fly on the wall at your own funeral. What three things would you want to be said about you at your eulogy. 

Principle of Deprivation

  • The danger with money is the principle of deprivation. When a person has money in life they tend to be less satisfied with life because they tend to want more money. They’re less apt to share. They’re dissatisfied with their job and have low energy. Dr Pelkowitz tells the story of a depressed 28 year old investment banker who came to see him. He had just received his Christmas bonus of $500, 000. Why was he depressed? Because the guy next to him got $700, 000. 
  • It’s important to see money for what it is. It’s a tool.
  • Research shows that once your basic needs are met, there is no difference in happiness levels if you have more money.
  • He also told the story of a man who came from a wealthy background and volunteered after college for the Peace Corps. He was sent as a teacher to a village in Nepal. It was a very poor village. He was given a one room hut with no running water or electricity. He doesn’t know how he’ll cope, but he found he got used to it very quickly because it’s the way everyone in the village lived. When he received his first pay check of $40 for the month he felt like quitting. Then he found out that no one in the village earned more than $30 a month. He never felt wealthier in his life. 
  • Happiness comes from connecting to what matters, for example relationships. Not from stuff. 
  • Money eases the bumps in life but it doesn’t guarantee happiness.

Don’t Indulge Your Children

  • Why do we indulge our children? 

It has to do with our own level of comfort with saying NO to our children. 

Because…

* We want to be fair.

*We want to keep up with friends.

* We want to avoid tantrums.

There’s a myth that crying is bad for your child. Research shows that it’s a growth experience. It’s part of life. Children have to face frustrations, which is an instrument for growth. Growing up without anything else but their own self entitlement is a disaster. The most loving thing is to sometimes let them struggle with NO.

*We’re making up for our own childhood. 

*To replace yourself – because of guilt. 

The negative impact of all this is that: 

– Possessions lose value. 

– You don’t teach them the effort and reward connection. 

– It’s important to teach persistence, which is needed to overcome obstacles. 

– It’s important children learn to delay gratification. 

The greatest prediction of success in life is GRIT. Being able to stick with your goals in the long term. The one way to teach grit is to teach NO. 

So parents have to figure out ways to say no, so that their children can build up the muscle of self-control, which is the single most powerful predicator of success in life. 

Core Recommendations

1. Its’ the invisible lessons about money that our children see. It’s what we emphasise. What we get emotional about. Make sure your conversations don’t revolve around goods and possessions. Don’t make material things the centre of your life. 

2. Distinguish between Wants and Needs

Encourage children to write wish lists so that they learn the value for waiting for what they want most. 

3. Focus on the Internal Issues

What’s it all about? What is the emptiness about? Why don’t children have a richer internal life, that they need things to fill it.

4. Learn to set BOUNDARIES

There was a study done where they found that kids who own their mistakes and immediately took responsibility and apologised were more successful socially and academically. 

When examining the difference between the top 1% of neurosurgeons and the bottom 1% they discovered that the predicator for being the top 1% is how they handle their mistakes, take responsibility for them and correct them. 

The biggest gift we give our children is to teach them to embrace their mistakes as learning experiences. 

Affluenza – What is the Antidote?

There was a study that compared wealthy kids to low socio-economic kids. She found that the affluent kids had triple the rate of anxiety, depression and alcohol abuse. She found three attributes that contributed to this:

  1. It was never enough to just be average in that community. Kids grew up feeling they have to grow up in this box. 

Solution – We need to nourish the flame of our children’s uniqueness.

    2. The children’s experience was that their parents were there but not there. The parenting was outsourced. 

Solution – Values need to be internalised. Children to need eye to eye contact. Soul to soul contact. It’s important to be there for your kids. (This doesn’t mean both parents can’t work by the way.)

   3. Required Helpfulness. The children took and never gave back. That’s no way to live life. It’s important to get away from materialism and focus on what’s really important in life. 

‘There are people who have the spirit of a slave and there are slaves who have a spirit filled with freedom. Someone who is faithful to their inner-self. That person is always free. Someone who’s entire life is about what other people want or other people think – they’re a slave.’ – Rabbi Kook

We want to raise our children to have a life of freedom. 

  • If we substitute with childcare then that quality must be excellent. 
  • Kids want more rules. They may not like it, but even they, in studies done asking if they’d have more rules for their children, acknowledge that they would. (Especially with regard to electronic devices.)
  • When you do have rules that make sense, children welcome them and listen to them. 
  • It’s important to find the balance between love and limits.

I know this is a lot of information all typed out in bullet form. The talk was great. The notes are a useful, if not guideline, then springboard to think a bit more about the way we’re relating to money, materialism and most of all our children.