Parents can trump cultural influences in guiding kids’ money decisions

| Julie Pfitzinger | June 21, 2011 | 0 Comments

When it comes to teaching children about money, Nathan Dungan, founder and president of Share Save Spend®, believes parents have a choice.

They can either allow today’s culture of immediate gratification to inform the money decisions their kids make or choose the better option of using their own family values, goals and actions to help them shape a narrative around money.

Dungan recently delivered a presentation called “Money Sanity Solutions: Linking Money + Meaning” (also the title of his latest book) at St. Olaf in Min­nea­polis during an event sponsored by the Catholic Community Founda­tion and Relevant Radio.

A noted financial expert and author from Minneapolis, Dungan travels around the country speaking about healthy money habits and has been featured in several publications including The Wall Street Journal and Time magazine and on CBS, CNN and PBS.


“Keep in mind the culture is working hard to shape the narrative about money for the next generation and it’s not a healthy narrative,” Dungan said. “If parents abandon their role to educate kids about money, the void will be filled and the dominant value is to spend.”

Connecting with values

In this consumer climate, Dungan believes it is especially important for parents to help kids make the connection between their family’s values and the financial decisions they make both now and when they get older.

“The order of the words ‘share, save, spend’ is very intentional,” he said. “Sharing is about paying attention to the needs of others out of gratitude. Saving is about patience and discipline. Spending focuses on needs and wants — and the difference between the two.”

Dungan hears from many parents who want to talk to their children about money but don’t really know where to begin the conversation.

Giving ages and stages

Age 4-5
Nurture empathy and caring; introduce idea of helping in the community. First cause may be animals; tour an animal shelter, use “share” dollars to purchase supplies and deliver to the shelter.

Age 5-10
Continue to nurture empathy; infuse allowance to help others. Ideas include birthday parties for a cause, collect books for a local shelter, volunteer at a local food bank. A good time to encourage family members to start giving child a “share” check.

Age 10-15
These are the exploring years and some adolescent cynicism may begin. Encourage child to “try out” different causes and become involved in giving/service projects. A good opportunity for child to engage family members and others around a cause he/she has identified as important.

Age 15-plus
Teens are becoming more independent and can volunteer without a parent. Some may be exploring careers through service or traveling for service-related projects. Help to nurture their “voice” around money and values. Put them to work.

Source: Nathan Dungan

“A family’s money narrative has many components. It is a collection of past events, people, stories, goals and ac­tions,” he said.

Dungan spoke about his own family and how fortunate he was that his grandparents chose to live below their means so that they would be able to give money to each of their seven grandchildren to attend college.

“When I was young and I would get a check from them on my birthday for my college savings, I thought it was nice, but I was more about ‘show me the money,’” said Dungan. “But when I started school at St. Olaf College, I was very thankful.”

In conversations with people over the years about healthy financial habits, Dungan said he has learned that families tend to have different communication styles around the subject of money.

“Some have told me the topic just never came up in their families. Others said it definitely came up — very loudly — during arguments,” he said. “The goal is to develop a sane middle, a place where conversations about money are open and emotionally neutral.”

Dungan also shared the results of a recent Synovate survey of 1,600 parents that found while 85 percent of parents said they teach their children about saving money, only 34 percent taught them about paying bills and 27 percent talked to them about how to use a checking account or credit card.

“It’s interesting that the topic of sharing money wasn’t included in the survey,” he said.

Parents looking for a place to start the dialogue with children about charitable giving might consider giving a child a “share check” for his/her birthday.

“Everything can be filled out on the check except the ‘pay to order’ line. The child can then decide where to donate the money,” he said, adding this is also a great idea for grandparents and can open up discussions about the importance of generosity.

A quick look at stats

Nathan Dungan shared the following statistics and their implications for this generation of young consumers and their parents:

» Every day, an individual experiences 5,000 advertising impressions.

» Teens in North America spend $100 billion per year — only $5.6 billion is actually earned by the teens themselves.

» Close to 40 percent of young people ages 18-29 are unemployed or underemployed. Many college graduates in this category are carrying student loan debt of nearly $30,000.

» Users of credit or debit cards are likely to spend 10 percent to 20 percent more than if they pay with cash. Beware of an approaching trend — paying with apps on a smart phone, which Dungan said will be common in three years’ time. Those who use this option will likely spend 10 percent to 20 percent more than those who use plastic.

Close the money loop

Another opportunity involves what Dungan called “experiential philanthropy, or time and money.” For young kids, just giving money to a cause can be abstract.

“If they want to donate to a food shelf, take them to buy the food and then drop the food off at the food shelf or shelter,” he said. “It’s a good way to help them close the loop.”

Dungan ended with a phrase he re­peated often throughout the presentation: “The choices we make with our money can change the world.”

“Parents have the opportunity to help their kids start thinking about money when they are as young as 4 or 5,” he said. “To magically hope the next generation will link their money and their values without our guidance is pretty naïve.”

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