Are you honest with your children about your money situation?

[Purpleandgreenyarn]

Hello

I just wanted to post to ask your thoughts on money and what or if you share your situation with your children.

For context;
My children are 9&4.
Im self employed and earn around £46k after tax. My husband is working, however, and this is where it gets complex, it’s a small start up and he gets paid infrequently and very little. For the past 24 months, we have mostly been living on my income. From time to time, he will be paid a tiny lump sum, but this is just as and when the money is available. This year, he was paid £5,000. Last year it was around £7,000.
So as you can imagine, we are not rolling in it, so to speak. Without completely outing ourselves, I do have a genuine reason to believe this will change. The buisness has been approached by a large conglomerate to work in collaboration on a product, contracts have been signed and the item is being produced, so I have every reason to believe that my husbands wage will increase over the next year.

Money has always been tight, my family had very little and my dad was always quite bad with money. He died many years ago but whilst I was at university he would ask me for my student loan, promising to pay back but never did. This left me getting into credit card debt and I ended up making very stupid financial decisions myself. It took me a while to get out of it, but part of that for me was getting over the shame of saying, I can’t afford it. Fast forward 15 or so years and I am in the black, no credit cards/student loans/overdrafts/loan/store cards at all, and I am saving towards a deposit for a home. However it will most likely be a flat on a shared ownership type scheme (I know they aren’t great but my only option realistically).

To get to the issue, my daughter has been saying she would like her own bedroom, she would like a house with a garden and she has lots of plans about furniture and decoration. To begin with I sort of idly and in a very non committal way would say oh wouldn’t that be lovely, maybe one day, so on and so on. But now it’s gotten to the point that I have started to say outright, I don’t think I can afford that. More recently she has been asking to join her friend in Piano and Karate lessons, but I just don’t have the money, so I was honest and said I won’t be able to afford that. She also mentioned over the summer how we didn’t have a holiday. Obviously it’s that time of year when kids are talking about what they would like for Christmas. I don’t want to create a bleak picture, because they will get what they ask for, clothes, books, craft supplies, and toys, but high ticket items are a no (and I think they would be even if I had lots of money). We go out for lunch as a family once a month, and again once a month we will go to the cinema, they have clothes and shoes when they need them and I tend to buy new, so I really believe that they are lucky on many fronts.
However my husband is taking umbrage with me saying to our daughter that we can’t afford things when she asks, he said he is over hearing her bringing it up with her friends and making herself sound like Oliver Twist. I appreciate we both have our own perspectives that may make seeing the situation clearly difficult, so I just wandered, what do you say to your children when they discuss things that are just not affordable to you? Are you honest? I don’t think she is at an age where I can distract her or try wriggle out of answering as she is nearly 10. Any advice/insights gratefully received.

cheers

I do sometimes exaggerate our financial situation when speaking about our financial situation to my daughter i.e. we cant afford it, it is too expensive, we need to save for it etc. Actually, we are quite comfortable and we can afford what she wants/asks without any problems. She is an only child and both my husband and I work in a professional role, mortgage paid off etc.

I did that so she has a sense of "priority" and not to always give in to what ever she wants. That she needs to plan (think) and assess before deciding to purchase something and learn "delay gratification". She does understand it to some extent, I think. She is also 9 like yours.

So, I think it is OK to be frank about your financial situation. I don't think it will do them any harms. It only becomes a problem if for example you start to share your worries/concerns about your finance with her; which then may make her as if she needs to do something to help you financially.

Hmm. Maybe your husband is reacting defensively because he’s earning so little. Is it his start-up? Because frankly they sound in breach of minimum wage law.

PS sorry to be blunt, but I don’t understand why you are putting up with this, that’s your real problem here.

Yeah at that age mine wanted a pony and their own stables

We earned pretty reasonably (but obviously not enough to buy a whole stables and there was no bloody way she was getting a pony as I know how much work they are).

We just said we can't afford it,

Your husband is over reacting probably because he isn't bringing in much and it's a sore point with him.

I made it clear to DD that there was fun money and bill money. Bill money needs to pay for the things we 'need' and is what is spent on first and we have plenty of that so no need to feel worried.

Fun money is for the things we 'want' and comes after paying the bills and sometimes we have to save up for the things we want. And then I made sure to give her pocket money, and then when she wanted things during the year she could decide whether she has enough fun money.

What you don't want is a child hearing we can't afford that overpriced magazine and thinking you are in dire straights with no money to eat and that misconception happens quite often

£12k in two years? You are supporting his hobby. I'd start with that conversation.

No I'm not in that I never discuss our savings or mortgages with the kids. However, I'm very honest and say we can't afford certain things. Like I told DC she's not having a iPhone 15. Or a Lapland holiday. There is no shame in not being able to afford everything. There is always someone with more money than you.

This is a really difficult one.
My exDH used to always be open and honest and told the kids we had no money or we couldn’t afford things and the kids takeaway from all that was that we were poor. Like Dickens work house poor.

I didn’t know how they parsed the info from him until a mum came up to me at school pick up with a bag of groceries once because the PTA had heard that we were really struggling. I was utterly humiliated. It was never that bad. She was being very kind but of course kids can’t get poverty as a spectrum. Kids are binary. Especially at that age.

Since then i have not ever discussed money with the kids. The problem with this is the younger ones have no idea about money and spending and common sense. It’s a really difficult one and I have no good answers but I mention the above as a cautionary tale really. Also I think your DH is feeling emasculated.

We've always been pretty honest with ours about money - and they've also both had jobs from 13 (more about them learning than needing it) - now both are in their 20s and have a great understanding of money and finance

Reading more of the replies I can understand the other point of view more. DH came from a very poor family and he will use it to tell the kids how fortunate we are to not have to worry about food, heating, or losing a coat. It's definitely true there's a spectrum of poverty. We aren't Elon Musk and it means they will need to find jobs and careers that can support themselves. It means we can't afford everything their friends have. But it doesn't mean we are poor. I think at nearly 10, she should be able to understand that.

Do you have stories from your childhood that you can use as an example to explain about the many shades of being poor?

It's difficult because you want to strike a balance in teaching your children about saving and prioritising without having them worry you are destitute. I explain to my 9 year old that certain things I think are not good value for money (trips to eurodisney).

If you tell her you can't afford music lessons and karate lessons she will repeat this to her friends - I have heard many children tell me they are stopping extra curriculars because of the expense.

At 9 I think they are starting to understand about money. I'd tell her what you prioritise your money on (and if it's not private - and you don't mind her repeating it- then that you are saving for a house).

My daughter asks if we are rich or poor and how much things cost. I haven't told her my salary but she knows how much a car and a house cost and that you have to save for years to buy them. I don't tell her my salary as she would repeat it, whereas the car and house cost are common knowledge.

My daughter has seen on tv that planes in first class have beds and has asked to fly first class. I've told her that I will never think that is good value for money so if that's someting she aspires to, she'd best start saving up.

I think it is fine to be honest OP.
I would not lie or exaggerate like some people on the thread have talked about doing.
Your DD gets a lot already with a meal out and cinema once a month. You are not poor. But you can't afford everything. So it is fine to say that. Otherwise kids think you are saying no because you do not want to spend your money on that, rather than you cant afford it.

And -please do not describe yourself as poor. You are not.

I agree with @CandyMaker
Youre not poor as such but yes like many people you have to make choices.

This is how I’ve approached things with my two dcs.
No one can have everything. You have to make choices. Insist on what they have that other friends might not be doing (eg my dcs didn’t have an outing once a month like this but they were doing other stuff iyswim)

Any dream about buying a house would lead to a discussion on why she’d love that and empathic answer about how it can be hard to share a bedroom, how to make it easier etc…

A discussion on adding this activity or the ither would be ‘it’s not possible to do everything. Which one would you prefer to do?’ Etc….

You can discuss your finances with your daughter however you please. When your husband actually starts to contribute financially, he can discuss it as he pleases.

Fwiw I think your DH is taking umbrage because he isn’t earning anything.
So the idea that his own dcs (and everyone else) think you are poor, aka he is poor/isn’t a good provider etc…. Is hurtful to him.

Maybe there is a discussion to have too about his input financially.

Your biggest issue @Purpleandgreenyarn is your husband only contributing 5k one year and 7 k another year and you are more than happy to subsidise his hobby.

Your daughter asking for piano or karate lessons isn’t unreasonable , this is what children do. Children also talk about their summer holidays and Christmas plans. The fact that your husband is working for himself but only bringing in 5k is utterly selfish and unfair on your child. Surely if he got a proper job your family could afford karate lessons or a caravan
holiday ?

I agree with this - karate lessons and a summer holiday aren't unreasonable wishes and you earn well @Purpleandgreenyarn - if that is your post tax income, well above average salary. If your husband's job is paying so poorly, could he take a side job to supplement his income until it's a realistic one. I'm a frugal person - but it seems to me your children are missing out. I was not allowed to do karate as a child ("unfeminine") and I feel I missed out - even though I was given many other things. Music lessons - I understand lots of state schools have an arrangement with the council to do this at less than market price

You need to have a conversation with your husband and he needs to get a second job whilst he isn't earning.

You then need to have a look at what activities there are (and their supplemental costs) in your area. Some clubs are very expensive, horse riding and music lessons you are looking at £20ish a session, dance classes maybe cheap but you need to find a recreational school as comp, show and exam costs can ramp up, Brownies or Cubs will be around a £5 or less I expect now. So work out your budget and give your DD the choice, she should be doing some sort of extracurricular if she wants to.

Find out what a summer holidays is to her - is it 2 weeks in the sun in Tenerife (I doubt it), or is it an ice cream on the beach. Plenty of seaside towns have Premier Inns and Travelodges now or a Caravan park, travel via train makes it more exciting.

Find out what she is struggling with in her room - what things can you put in place to achieve a similar goal as her own room.

I didn’t describe myself as poor

Some interesting views.

I never said I was poor.

As for DH comments, I suppose not surprising. It’s his start up, the first year there was lots of costs, the second year everything has been put on hold to focus solely on the release of the collab project. He works around 70 hours a week. It’s not a hobby, but I’m not willing to go into details about what it is for obvious privacy reasons so I will just have to accept those unjustified comments.

I agree I think he is feeling emasculated and I admit, sometimes I feel really bitter about footing every bill, especially when I would love a two week holiday abroad and know that’s just not going to happen right now. But that wasn’t so much the point of the thread, more if others felt it was acceptable and fair to say to a child no we can’t afford that.

Anyway thanks

I agree with a previous poster in explaining it with biils money then fun money. Our kids are 10-15 and they all understand that we have enough money to pay the bills and buy the basics but fun money is short in supply.

I made it clear to DD that there was fun money and bill money. Bill money needs to pay for the things we 'need' and is what is spent on first and we have plenty of that so no need to feel worried.
Fun money is for the things we 'want' and comes after paying the bills and sometimes we have to save up for the things we want. And then I made sure to give her pocket money, and then when she wanted things during the year she could decide whether she has enough fun money.
@HPandthelastwish - this is great, I'm going to use this.

Interesting reading perspectives on this. I have to have this conversation quite a lot with my 8yo. I'm a single parent, and we're fine - can pay mortgage and have a holiday every year and they do some clubs. But I do have to say no to a lot of things - takeaway, cinema regularly, those bloody magazines etc so I can put some money aside for holidays and just because I earn a lot less than their dad so there's a conflict of lifestyles to a degree. He does have magpie tendencies and seems to want want want, especially with Christmas, and seeing things his friends have.

My older one, though, I think worries about asking for little things, and I hate that he's worried we're poor. His friends happen to all be from pretty well off families, so in comparison I worry he feels it as their holidays are all far-flung and houses much bigger etc. I've said to him a few times, 'We have more than enough.' - so I'm grateful to see perspectives on here about the other side - and kids not distinguishing between 'less money' and 'dire straits'.

OP, good luck with buying your home! And with your H's business. I think a second job in the meantime would be ideal - even one evening and weekend shift at a shop or restaurant would bring in £250 or so a month, and this would ease pressure and mean your DC could do a club, and you could all have a holiday.

A start up where your DH works 70 hours a week but only brings in 5k is a hobby @Purpleandgreenyarn . IMO start ups etc should be set up alongside a full time job. Your daughter is missing out because your husband wants to work for himself but his earnings isn’t sufficient to provide a decent quality of living. He could get a job in Tescos etc and be paid more. Your daughter would get a caravan holiday in Summer, a Christmas experience and a hobby instead of telling her that she won’t be able to do these things or decorate her room .

I would be honest with my children about affordability of things, it's a reality of life that some people have more money than others.
I was very aware of my parents financial problems growing up and am very different with them with my money now, my sister was much younger and less aware of the hardships and has a much more similar attitude to them about money.