Mounting research shows that we have nothing short of an entitlement epidemic gripping today's youth. The books Generation Me and Generation Debt (by two different authors, no less) make rather fitting bookends: narcissistic entitlement at one end, and financial ruin at the other.
Still, there are ways to persuade material boys and girls to ignore the cabal of commercialism feeding their "I wants." To borrow from the classic education vernacular, the trick is to turn toy-store temper tantrums into "teaching moments."
Here are a five ways to instill some key money lessons without lecturing:
1. Teach them to value every dollar. Tired of playing shopping-cart bad cop? Give your child spending power by turning the yes/no verdict over to Junior. Children who are free to spend their money on whatever they want (provided it doesn't require gunpowder, gasoline, or a parental signature on a safety waiver) are more thoughtful and less impulsive -- after a while, at least.
2. Make dollar decisions tangible. Even adults have a hard time visualizing mounting debt or increased savings. Help your children grasp such concepts with visual cues: Illustrate important allocation lessons of short-term funds, long-term savings, and charity with separate piggy banks for each (or a single one designed specifically for this purpose), or even with a running tally on a whiteboard in their bedroom.
3. Pull back the curtain on retail marketing tricks. Kids don't like being told what to do. Show them that advertisers are bossier than Mom and Dad are with a set of interactive lessons on common marketing mind tricks, available at pbskids.org/dontbuyit.
4. Reward savings behavior. According to sharesavespend.com, our kids today spend five times as much money as we did at the same age (adjusted for inflation). Reverse the trend by rewarding responsible cash conduct. Set up a kiddie version of a 401(k), and offer to match money that they sock away for themselves and others (e.g., $0.50 for every dollar they save for themselves; a dollar-for-dollar match for money they raise for a good cause).
5. Get them excited about stocks, not stuff. The stock market (and the passage of time) can also reward the little ones in a big way. Engaging kids in investing pursuits is easy: Just explain that when they buy a share of stock, they become part owners of the company, not just a customer. (A seat on the board, however, may have to wait until after they're old enough to drive.)
Every moment of every day, they're presented with investment opportunities, from breakfast (General Mills
Finally, call Junior over to the computer for some family time. Together, you can help other kids become smart about money by checking out Foolanthropy.com -- The Motley Fool's ongoing drive aimed at eradicating financial illiteracy.
