I just saw a Yahoo Finance article that said that only 17% of people who make over $100,000 per year tell their children how much they make, with the most common reason being “it’s none of their business.” I don’t know how much I agree with this.
My father was very open about money to us when we got into high school. We knew how much he made and how much he spent and he talked about frivolous spending frequently. My mother is still a bit shy in discussing it, for some reason.
So this can go both ways. If you make A LOT of money and you think it could cause problems with your kids knowing that much money due to ego/arrogance/being spoiled, I can understand that concern, but is that really because of how much money YOU make or because your kids may already be spoiled and there was an issue raising them? I am not trying to throw stones, but there are plenty of good kids that come out of very wealthy families and plenty of bad kids that come out of lower income families.
I am a BIG believer in being open about money at an early age so it can show your kids what it takes to live certain lifestyles. If you don’t make a lot, it will show your kids the limitations of money and when you aren’t able to provide certain things, it shouldn’t be a cause for embarrassment but more of a reason to talk to them about why they may want to take more risks or go get an extra degree in school in order to achieve higher income.
If you make a lot of money, your kids will see that it takes a lot to live a nice lifestyle and to get the things they will want later in life and the security of retiring at a younger age.
The bottom line is that if you raise your kids the way you should by valuing a dollar no matter what your income is, they will learn to appreciate that income level. I know that I am a big saver and conservative with investing because I never want to sacrifice the lifestyle I have grown accustomed too. Has that inhibited my risk taking? ABSOLUTELY! Do I regret that? Absolutely not. I just have to find other ways to make above average returns other than taking undue risks that could sacrifice what I had the good fortune to be able to build on.
Don’t be scared to show your kids what you have. It’s a great way to teach them. Everything can be made into a good situation or a bad situation: take whatever situation you are in and use it as a learning tool for your kids. The kids I know whose parents were very tight about their information grew up to resent the lack of trust their parents had with them.